The natural rate of unemployment is defined as the unemployment rate that exists in the absence of:

Question

Quizplus · Accepted Answer

The natural rate of unemployment is also known as the "full employment" rate, meaning it is the rate of unemployment that exists when the economy is operating at its potential output level and there is no cyclical unemployment. Structural and frictional unemployment will still exist at the natural rate, but their impact on the overall unemployment rate will be minimized. Seasonal unemployment is not typically considered in the calculation of the natural rate.

The Natural Rate of Unemployment Is Defined as the Unemployment