Public policy
A)can reduce both frictional unemployment and the natural rate of unemployment.
B)can reduce frictional unemployment, but it cannot reduce the natural rate of unemployment.
C)cannot reduce frictional unemployment, but it can reduce the natural rate of unemployment.
D)cannot reduce either frictional unemployment or the natural rate of unemployment.

Question

Quizplus · Accepted Answer

Public policy can address both frictional unemployment, which is the short-term unemployment that arises from the process of matching workers with jobs, and the natural rate of unemployment, which includes frictional plus structural unemployment, through measures such as job training programs, education, and efficient unemployment benefits. These policies can make the labor market more efficient and help workers transition between jobs more quickly, thus potentially reducing both types of unemployment.

Public Policy