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Question : The concept of "unemployment elasticity" measures:

Option 1: The responsiveness of unemployment to changes in economic growth

Option 2: The relationship between wages and employment levels

Option 3: The impact of labor market regulations on unemployment rates

Option 4: The correlation between educational attainment and unemployment rates


Team Careers360 22nd Jan, 2024
Answer (1)
Team Careers360 25th Jan, 2024

Correct Answer: The responsiveness of unemployment to changes in economic growth


Solution : The correct answer is (a) The responsiveness of unemployment to changes in economic growth.

Unemployment elasticity is a measure that assesses how changes in economic growth or output affect the unemployment rate. It quantifies the degree to which unemployment rates change in response to changes in overall economic conditions. A high unemployment elasticity indicates that unemployment is highly responsive to changes in economic growth, while a low elasticity suggests a less significant impact of economic growth on unemployment rates. It is an important indicator for understanding the relationship between macroeconomic factors and employment levels in an economy.

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