Question 16
Labour MarketUnemployment can be classified as:
I. Frictional — occurring between jobs during search
II. Structural — caused by declining industries or skills mismatch
III. Cyclical — resulting from insufficient aggregate demand
IV. Seasonal — permanent loss of jobs due to automation
- A.I, II and III only
- B.I and II only
- C.II, III and IV only
- D.All of the above
Show the answer and explanation
Answer: A (I, II and III only)
Explanation
I, II and III are correctly described. Seasonal unemployment comes from the time of year (e.g. farming), not permanent job loss from automation.