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The full employment means that        everyone has a job.         the unemployment rate...

The full employment means that

      
everyone has a job.

       
the unemployment rate is zero.

       
the unemployment rate is equal to the natural unemployment rate.

       
the economy performs outside its production possibilities frontier (PPF)

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Answer #1

In economics, full employment means that there is only structural and frictional unemployment

Natural unemployment rate = structural unemployment + frictional unemployment

Thus, Full employment means unemployment level in an economy is equal to natural unemployment rate.

(Note full employment does not means that unemployment is zero or every guy has job. Also, when economy is at it full employment then this means that economy is producing on a PPF. Hence (a), (b) and (d) are incorrect.)

Hence, the correct answer is (c) the unemployment rate is equal to the natural unemployment rate.

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