With everything else held constant, if society increased the efficiency of matching people to jobs that need their skills, the natural rate of unemployment would likely:
A) not change.
B) increase.
C) decrease.
D) increase or decrease as we do not have enough information to determine the answer.

Question

Quizplus · Accepted Answer

Improving the efficiency of matching people to jobs reduces frictional unemployment, which is a component of the natural rate of unemployment, thus decreasing the natural rate.

With Everything Else Held Constant, If Society Increased the Efficiency