💼 Pre-MBA Exam Prep

The natural rate of unemployment includes:

A Only cyclical unemployment
B Frictional and structural unemployment that exist even when the economy is at full employment
C Zero unemployment
D Only seasonal unemployment

✓ Correct Answer: Option B

Natural rate (NAIRU): frictional (job search between positions) + structural (skills mismatch, geographical barriers). Economy at full employment still has these — cyclical unemployment = 0.

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