Which one of the following statements is TRUE?
A) The existence of unemployment places the economy at a point inside its production possibilities curve.
B) The unemployment rate is the percentage of the population not working.
C) To be counted as part of the labor force, an individual must be working more than 40 hours a week.
D) The sum of wages lost by all unemployed workers gives an accurate, comprehensive estimate of the total cost of unemployment.

Question

Quizplus · Accepted Answer

The existence of unemployment means that not all available labor resources are being used, which places the economy inside its production possibilities curve, indicating that the economy is not operating at its maximum potential output.

Which One of the Following Statements Is TRUE