6. What causes changes in the natural and actual rates of unemployment

Suppose the fictional country of Sounx is facing a decrease in the proportion of younger workers in the labor force due to a decline in birth rates.

Most likely Sounx's natural rate of unemployment will_______ in the future.

The following graph shows Sounx's potential real GDP (the tan line) and actual real GDP (the blue line) from 1990 to 2010.

On the graph, use the grey star to highlight the area between the potential and actual GDP lines corresponding to the period when Sounx experienced economic expansion.

Expansion19901992199419961998200020022004200620082010109876543210GDP (Billions of dollars)YEARPotential GDPActual GDPArea: 20.24118

During the period you identified on the graph, Sounx's actual unemployment rate ______________ .