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Chapter 21: Q 19. (page 524)

When would you expect cyclical unemployment to

be rising? Falling?

Short Answer

Expert verified

There are situations when cyclical unemployment will fall and rise. As cyclical unemployment relates to the business cycle of an economy.

Step by step solution

01

Step 1. Definition

Cyclical unemployment is a type of the various types of unemployment. It is defined as unemployment in which the main causes are the cyclical trends in the economy like economic upturn and economic downturn.

02

Step 2. Explanation

Cyclical unemployment will fall when an economy is doing goods and is in the phase of expansion. Because in the time of expansion the firms will hire a greater number of people.

Cyclical unemployment will rise when the economy is not doing good and is in a state of recession. Because at the time of recession the firms will hesitate from hiring people.

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Most popular questions from this chapter

A government passes a family-friendly law that no companies can have evening, nighttime, or weekend hours so that everyone can be home with their families during these times. Analyze the effect of this law using a demand and supply diagram for the labor market: first assuming that wages are flexible, and then assuming that wages are sticky downward.

A country with a population of eight million adults has five million employed, 500,000 unemployed, and the rest of the adult population is out of the labor force. What’s the unemployment rate? What share of the population is in the labor force? Sketch a pie chart that divides the adult population into these three groups.

What are some of the problems with using the unemployment rate as an accurate measure of overall joblessness?

Using the above data, what is the unemployment rate? These data are U.S. statistics from 2010. How does it compare to the February 2015 unemployment rate computed earlier?

Is it desirable to eliminate natural unemployment? Why or why not?
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