Q:

Unemployment resulting from changes in the basic composition of the economy, which at the same time opens new positions for trained workers is known as:
a) Structural Unemployment
b) Cyclical Unemployment
c) Frictional Unemployment
d) Natural Unemployment
e) None of these are correct

A:

The correct answer is a.
An example of structural unemployment is the technological revolution. Computers might have eliminated jobs, but it also opened up new positions for those who had the skills to operate the computers.
Frictional unemployment occurs when workers and employers have inconsistent or incomplete information. For example a person might be able to get a job, but is holding out for a better paying one.
Cyclical unemployment results from changes in the business cycle.
Natural unemployment is similar to the long run average unemployment. It is important to remember that 'full employment' is when the economy is at its natural rate of unemployment.

Have a Financial Question?

RELATED FAQS

  1. No results found.
RELATED TERMS
  1. Personal Financial Advisor

    Professionals who help individuals manage their finances by providing ...
  2. CFA Institute

    Formerly known as the Association for Investment Management and ...
  3. Chartered Financial Analyst - CFA

    A professional designation given by the CFA Institute (formerly ...
  4. Security Analyst

    A financial professional who studies various industries and companies, ...
Hot Definitions
  1. Super Bowl Indicator

    An indicator based on the belief that a Super Bowl win for a team from the old AFL (AFC division) foretells a decline in ...
  2. Flight To Quality

    The action of investors moving their capital away from riskier investments to the safest possible investment vehicles. This ...
  3. Discouraged Worker

    A person who is eligible for employment and is able to work, but is currently unemployed and has not attempted to find employment ...
  4. Ponzimonium

    After Bernard Madoff's $65 billion Ponzi scheme was revealed, many new (smaller-scale) Ponzi schemers became exposed. Ponzimonium ...
  5. Quarterly Earnings Report

    A quarterly filing made by public companies to report their performance. Included in earnings reports are items such as net ...
Trading Center