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Zero unemployment is:

A. Only possible in recessions.
B. Not possible.
C. Only possible in expansions.
D. The official main goal of macroeconomic policymakers.

Answer :

Zero unemployment is not possible in any phase of the business cycle, whether it is a recession or expansion. Unemployment is a lagging indicator and tends to decrease during expansions and increase during recessions.

The official main goal of macroeconomic policymakers is to achieve maximum employment and price stability. This means that policymakers aim to maintain an economy with a low and stable rate of inflation and high levels of employment. Zero unemployment is not a feasible or desirable goal for policymakers, as some level of unemployment is considered to be natural and necessary for an economy to function effectively.For example, some level of unemployment is necessary to accommodate changes in the labor market, such as workers transitioning between jobs, and to maintain flexibility in the labor market. Additionally, if unemployment were to fall to zero, it could lead to inflationary pressures, as employers would have to compete for workers, driving up wages and prices.Therefore, while zero unemployment is not possible, macroeconomic policymakers aim to achieve a balance between low unemployment and price stability, through the use of monetary and fiscal policy tools.

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