Practice Quiz

Case Interview Prep

Category - Economics

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In this current recession, there are many cities with unemployment rates as high as 25% due to the loss of jobs across all sectors and industries. What is this type of unemployment called?
  1. sector deficient
  2. wage deficient
  3. supply deficient
  4. demand deficient
Explanation
Answer: D - This type of unemployment is called demand deficient.

Key Takeaway: Demand deficient unemployment that is caused by a general reduction of demand across all industries and sectors. A widespread recession is one example in which a general lack of demand for workers occurs.
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