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Macroeconomics

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Moderate

Full Employment, Frictional, Structural and Cyclical Unemployment

MACRO-QTCJLI

Suppose that the labor market of Winterfell has a frictional unemployment rate of 2.5% and a structural unemployment rate of 1.6%. Suppose further that economic growth has been very brisk averaging about 2% per quarter and just last month inflation began to increase very slightly.

Which of the following statements is correct in relation to the likely unemployment rate in Winterfell?

A

It is roughly 6.1%.

B

It is roughly 4.1%.

C

It is roughly 0.9%.

D

It is roughly 0.0%.