Please type all the answers for ab c shortly thank you Assum

Please type all the answers for a,b, c shortly, thank you.

Assume that the United States economy is operating below full employment.

a) Define full employment – hint this is what economist call the natural rate of unemployment

b) Explain why we expect to have some degree of unemployment regardless of how well the economy is doing

c) Explain why the United States still faces scarcity despite being one of the richest countries in the world.

Solution

_{A.Full employment is a condition when all those who wants to work are employed.Natural rate of unemployment is the minimum level of unemployment that exists in an economy.This is generally 5-5.5%.It is natural because it exists due to factors other than economic inefficiencies.It is caused by both frictional and structural unemployment.}

_{b.Frictional unemployment is called by people switching jobs or because of the time after to find a job right after getting through a college.Structural unemployment is caused by the changes in the structure of an industry.These are both part of natural rate of unemployment.Thus,some unemployment would always exists in the economy due to these factors.}

_{C.US still faces scarcity because despite of being the richest nation,its resources are still limited.Use of limited resources is concerned with opportunity cost.This leads to scarcity.}