Gce Model Questions Vol1 2023 Economics Question 27
Practice objective / multiple choice question 27 from the 2023 Gce Model Questions Vol1 Economics examination.
Actual output is \(£720\) billion while potential output is \(£800\) billion. Okun's law states that a 1\% output gap raises the unemployment rate by 0.5 percentage points. The current unemployment rate is 7\%. Assuming the only source of deviation from the natural rate is the output gap, calculate the natural rate of unemployment (structural + frictional). Express your answer as a percentage to one decimal place.
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This is Gce Model Questions Vol1 2023 Economics Question 27. It is one of the objective questions from the 2023 Gce Model Questions Vol1 Economics examination.
Difficulty level: Medium .
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