Which of the following would be most likely to cause a decrease in the natural rate of unemployment?

Choose 1 answer:
(A) People enter the job market at an earlier age
(B) An economic boom leads a temporary increase in output
(C) Public policies such as unemployment insurance are introduced
(D) More people opt for an early retirement
(E) A recession causes widespread layoffs

Question

Which of the following would be most likely to cause a decrease in the natural rate of unemployment?

Choose 1 answer:
(A) People enter the job market at an earlier age
(B) An economic boom leads a temporary increase in output
(C) Public policies such as unemployment insurance are introduced
(D) More people opt for an early retirement
(E) A recession causes widespread layoffs

Accepted Answer

***A*** ∻Key Concept∻ ⚹Natural Rate of Unemployment⚹ ∻Explanation∻ ⚹The natural rate of unemployment is the level of unemployment consistent with a stable rate of inflation. If people enter the job market at an earlier age, the labor force increases, potentially reducing the natural rate of unemployment if these new workers find jobs quickly.⚹◊Can you explain how an increase in the natural rate of unemployment can impact long-term economic growth?⍭ Generate me a similar question◊

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