This blog has been created to provide an area for economics students to read about how economics impacts daily life. It is especially useful for students to understand the application of macroeconomics as communicated through the media and governmental websites.

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Brief description: Cyclical unemployment is unemployment that occurs in conjunction with the business cycle where there is insufficient demand to support full employment.

Detailed description: On the diagram you can see that the equilibrium in the economy (yU) is at a level of output below full employment (yF). There is therefore insufficient aggregate demand to achieve full employment.