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Suppose the Economy Is Producing Below Its Potential Output Level

Question 93

Multiple Choice

Suppose the economy is producing below its potential output level.Which of the following characterizes the unemployment situation?  


A)  The actual unemployment rate would equal the natural rate. 
B)  No cyclical unemployment would occur. 
C)  Structural unemployment would be equal to zero. 
D)  Some cyclical unemployment would occur.

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