Question

2. Give meanings of: (i) Involuntary unemployment; (ii) Full employment, and (ii) Under employment equilibrium ​

Answer 1

Answer:

Involuntary unemployment:

Involuntary unemployment occurs when a person is willing to work at the prevailing wage yet is unemployed

full employment:Full employment is an economic situation in which all available labor resources are being used in the most efficient way possible.

Full employment is an economic situation in which all available labor resources are being used in the most efficient way possible. Full employment embodies the highest amount of skilled and unskilled labor that can be employed within an economy at any given time.

Under employment equilibrium :

Deficient demand refers to the situation when aggregate demand is short of aggregate supply corresponding. Aggregate supply being perfectly elastic, it converges with aggregate demand at a lower level of output lower than the full employment level of output in the economy. This is a situation of underemployment equilibrium.

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