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An economy in a deep recession has unemployment that is mainly which type?
ACyclical
BFrictional
CStructural
DNatural
Answer & Solution
Correct answer: A. Cyclical
1. The cause of the unemployment identifies its type.
2. Frictional unemployment arises as workers move between jobs.
3. Structural unemployment is a factor influencing the natural rate.
4. Cyclical unemployment is the variation caused by moving between expansion and recession.
5. A deep recession is exactly that movement, so cyclical unemployment dominates.
_Source: OpenStax Principles of Macroeconomics for AP Courses 2e (CC BY 4.0), Ch 7 'Unemployment'_
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