The natural rate of unemployment exists at a. some point within the interior of the PPF...
The natural rate of unemployment exists at
|
a. |
some point within the interior of the PPF but outside the limits of the institutional PPF. |
|
b. |
some point within the interior of the physical PPF, but we cannot locate it with more accuracy. |
|
c. |
some point within the interior of the institutional PPF, but we cannot locate it with more accuracy. |
|
d. |
every point on the institutional PPF. |
|
e. |
every point on the physical PPF. |
Homework Answers
The natural rate of unemployment exists at -
(d) every point on the institutional PPF.
Explanation - Every point on the PPF illustrates various combinations of goods that can be produced given the resources and technology available. Thus, natural rate of unemployment exists at every point on the institutional PPF as the economy is producing at full capacity level.
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