Explanation The long run- aggregate supply curve is vertical at the full employment level. This is the maximum output that can be produced using all the resources to their fullest. At the full employment level, employment is at its natural rate. Even though all the economy’s resources are full...

Many economists view the natural rate of unemployment as the level observed when real GDP is given by the position of the long run aggregate supply curve . How can there be positive unemployment in this situation.

Economics Today: Macro View (Looseleaf)

18th Edition

ISBN: 9780133916492

Author: Miller

Publisher: PEARSON

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Chapter 10, Problem 1P

To determine

Many economists view the natural rate of unemployment as the level observed when real GDP is given by the position of the long run aggregate supply curve. How can there be positive unemployment in this situation.

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