Running head: MACRO ECONOMICS
QUESTION 1 Explain the three types of unemployment.
To begin with, Structural and frictional unemployment are the natural unemployment rate
while cyclical type arises when demand falls mainly during a recession. Frictional types occur
when workers leave their old jobs because they have been fired so as to search ones but they
have not yet obtained them. It also occurs when students are searching for a new job or when
mothers are returning to their working areas (Porket, 1989). Structural unemployment occurs
when a change is needed in the economy where the workers are replaced with machines like
robots as this makes them to be unemployed for a long time and are forced to search for lower
level jobs. Cyclical type occurs when the demand of goods and services fall greatly and the
business is forced to cut off workers so as to reduce the costs.
In conclusion, these types of unemployment cause a lot of lose to the people since they are
unable to meet their demands. The government should search for solutions so as to minimize the
rate of unemployment in the society and help the youths acquire jobs easily.
QUESTION 2 Explai...