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CAIE A-Level Economics A2 9.3.4 Natural Rate of Unemployment Questions

Practise defining the natural rate as equilibrium unemployment including frictional and structural elements and evaluating skills, mobility, information, benefits and labour institutions.

Syllabus
2026–2028
Course
Economics 9708
Level
A2

Exam points

  • distinguish the natural rate from cyclical unemployment and include frictional and structural components
  • explain how training, mobility and vacancy information reduce skill or location mismatch
  • predict how generous benefits or stronger wage rigidities may raise equilibrium unemployment

CAIE A-Level Economics A2 9.3.4 Natural Rate of Unemployment Questions question 1

[Maximum number: 1]

Which policy is most likely to lead to a reduction in the natural rate of unemployment?

A

an increase in government expenditure on goods and services

B

an increase in government expenditure on training schemes to address skill shortages

C

an increase in the period when the unemployed are eligible for welfare benefits

D

an increase in the minimum wage

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