Frictional unemployment increases when
A) real GDP decreases and the unemployment rate rises.
B) the number of workers who quit one job to find another increases.
C) discouraged workers drop out of the work force.
D) workers are replaced by machines and the unemployed workers do not have the skills to perform new jobs.

Question

Quizplus · Accepted Answer

Frictional unemployment occurs when people are between jobs or are entering the workforce for the first time. It is often seen as a healthy sign of a dynamic labor market where individuals are seeking better opportunities. Therefore, when the number of workers who quit one job to find another increases, frictional unemployment increases because these individuals are temporarily unemployed while searching for new positions.

Frictional Unemployment Increases When