E2.Unemployment

(a) Define structural, cyclical and frictional unemployment and give an example of each.

(b) For each type of unemployment (structural, cyclical and frictional) explain whether it is costly to society, and if so why.

(c) Give one example each of how policymakers (e.g. the President and Congress) could help reduce structural, cyclical and frictional unemployment

(d) Explain how we can measure the cost of cyclical unemployment to society in terms of lost GDP.What is the social cost of 6 percent cyclical unemployment?