Ayushi posted an Question
September 09, 2020 • 16:49 pm 30 points
  • UGC NET
  • Economics

Involuntary unemployment takes place in which of the following situations? 1. deflation 2. disinflation 3. reflation 4. inflation

Involuntary unemployment takes place in which of the following situations? 1. Deflation 2. Disinflation 3. Reflation 4. Inflation

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    Nidhi taparia Best Answer

    While there can be many reasons for involuntary unemployment, one of the key ones is that a situation of deficiency of demand oe deflation exists. Involuntary unemployment means some people who are willing to work at current wage rate, are not able to find work. This may be because there is not enough demand, so production and investment is below equilibrium level. This is a situation of deflation.

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