Question 2 (15 marks)

a.What is natural rate of unemployment? When do we say an economy has full employment?

b.Identify what type of unemployment will result from the following scenarios

a.Jane has completed college and quit her job at Tim Horton so she can work full-time in her marketing field:

b.The clothing store George used to work for was shut down as the clothing brand is now selling all its collection through its online website:

c. The business Hank was working for had to shut down as there has been a decrease in overall demand in the economy:

c. Talk about one policy that the government can use to reduce frictional unemployment