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When the productive capacity of the economic system of the state is inadequate to create a sufficient number of jobs, it is called _______.
  • a)
    seasonal unemployment
  • b)
    structural unemployment
  • c)
    disguised unemployment
  • d)
    cyclical unemployment
Correct answer is option 'D'. Can you explain this answer?
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When the productive capacity of the economic system of the state is in...
Cyclical unemployment is unemployment that results when the overall demand for goods and services in an economy cannot support full employment. It occurs during periods of slow economic growth or during periods of economic contraction.
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When the productive capacity of the economic system of the state is in...
Cyclical unemployment occurs when the productive capacity of the economic system of a state is inadequate to create a sufficient number of jobs. This type of unemployment is closely tied to the business cycle and is a result of fluctuations in economic activity.

Explanation:

1. Cyclical unemployment and economic cycles:
- Cyclical unemployment is a type of unemployment that is influenced by the ups and downs of the business cycle.
- During periods of economic expansion, businesses are experiencing growth and demand for goods and services increases. As a result, firms hire more workers to meet the growing demand, reducing unemployment.
- Conversely, during periods of economic contraction or recession, businesses may experience a decrease in demand, leading to a decline in production. This can result in firms laying off workers or reducing hiring, leading to an increase in unemployment.

2. Inadequate productive capacity:
- When the productive capacity of the economic system is inadequate, it means that the economy is unable to produce enough goods and services to meet the demand.
- This can occur due to various factors such as technological advancements, changes in consumer preferences, or inefficiencies in the production process.
- When the productive capacity is insufficient, businesses may not have the need to hire additional workers, leading to unemployment.

3. Insufficient job creation:
- Insufficient job creation refers to the situation where the number of jobs being created is inadequate to absorb the available labor force.
- When the productive capacity is unable to create a sufficient number of jobs, it implies that there are more job seekers than available job openings.
- This can result in unemployment as individuals are unable to find suitable employment opportunities.

4. Other types of unemployment:
a) Seasonal unemployment: This type of unemployment occurs due to predictable seasonal fluctuations in demand for certain industries. For example, ski resort workers may be unemployed during the summer months.
b) Structural unemployment: This type of unemployment occurs due to a mismatch between the skills and qualifications of workers and the available job opportunities. It is often caused by technological advancements or changes in the structure of the economy.
c) Disguised unemployment: This refers to a situation where individuals appear to be employed but are actually underemployed or not fully utilizing their skills and abilities.

In conclusion, when the productive capacity of the economic system of a state is inadequate to create a sufficient number of jobs, it is referred to as cyclical unemployment. This type of unemployment is closely tied to the business cycle and occurs during periods of economic contraction or recession.
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When the productive capacity of the economic system of the state is inadequate to create a sufficient number of jobs, it is called _______.a)seasonal unemploymentb)structural unemploymentc)disguised unemploymentd)cyclical unemploymentCorrect answer is option 'D'. Can you explain this answer?
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