Reducing the natural rate of unemployment requires reducing the rate of job separation and increasing the rate of job finding. Explain at least one policy that will impact each of these aspects of the natural rate of unemployment.
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How will the following changes affect the natural rate of unemployment? a. The government reduces the time during which an unemployed worker can receive unemployment benefits. b. More teenagers focus on their studies and do not look for jobs until after college. c. Greater access to the internet leads both potential employers and potential employees to use the internet to list and find jobs. d. Union membership declines.
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What is the cause of the high unemployment rate? One side says there is not enough government spending. The other says it's a structural problem-people who can't move to take new jobs because they are tied down to burdensome mortgages or firms that can't find workers with the requisite skills to fill job openings. Which business cycle theory would say that most of the unemployment is cyclical? Which would say it is an increase in the natural rate? Why?
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