Economic Analysis of Social Issues 1st Edition by Alan Grant

Exercise 33

Okun's law says that for every 1-percentage-point in-crease in the cyclical unemployment rate,_______.
A) Real GDP growth will increase by 1 percentage point
B) Real GDP growth will decrease by 2 percentage points
C) The natural rate of unemployment will increase by 2 percentage points
D) The natural rate of unemployment will increase by 0.5 percentage points