Which of the following statements about the behavior of the unemployment rate in the United States is true?
A) The unemployment rate in the 1981-83 recession involved a peak rate of unemployment higher than the peak rate in earlier post-World War II recessions.
B) Generally speaking, when the actual level of output is below the natural level of output, the actual level of unemployment tends to be above the natural level of unemployment.
C) Generally speaking, when the actual level of output is above the natural level of output, the actual level of unemployment tends to be above the natural level of unemployment.
D) Both A and B.

Question

Quizplus · Accepted Answer

The 1981-83 recession had a peak unemployment rate higher than earlier post-WWII recessions. When output is below the natural level, unemployment is typically above the natural rate.

Which of the Following Statements About the Behavior of the Unemployment