Gce Model Questions Vol1 2024 Economics Question 26

Practice objective / multiple choice question 26 from the 2024 Gce Model Questions Vol1 Economics examination.

Gce Model Questions Vol1 2024 Economics Objective / Multiple Choice Medium Difficulty
Question 26 GCE_MODEL_QUESTIONS_VOL1 • 2024 • ECONOMICS • objective

The labour force in Country A is 20 million. The actual unemployment rate is \(8\%\). Frictional unemployment is estimated at \(2\%\) and structural unemployment at \(3\%\). (a) Calculate the cyclical unemployment rate and the number of people unemployed cyclically. (b) If a policy reduces cyclical unemployment by half, what will be the new actual unemployment rate and the corresponding number of unemployed people?

Answer Options

Correct Answer A. Cyclical rate = 3\% (600,000 people); after policy the actual unemployment rate = 6.5\% (1,300,000 people)
B. Cyclical rate = 2\% (400,000 people); after policy the actual unemployment rate = 6\% (1,200,000 people)
C. Cyclical rate = 3\% (600,000 people); after policy the actual unemployment rate = 7\% (1,400,000 people)
D. Cyclical rate = 4\% (800,000 people); after policy the actual unemployment rate = 7\% (1,400,000 people)
Correct Answer
A
Correct Option:
Cyclical rate = 3\% (600,000 people); after policy the actual unemployment rate = 6.5\% (1,300,000 people)

About This Question

This is Gce Model Questions Vol1 2024 Economics Question 26. It is one of the objective questions from the 2024 Gce Model Questions Vol1 Economics examination.

Difficulty level: Medium .

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