Question 12 The type of unemployment caused by changes in the business cycle is (1) structural unemployment. (2) cyclical unemployment. (3) natural unemployment. (4) frictional unemployment.

The type of unemployment caused by changes in the business cycle is: (2) cyclical unemployment. ### Explanation: - **Cyclical Unemployment**: This type of unemployment occurs due to fluctuations in the economic cycle. When the economy is in a recession, demand for goods and services decreases, leading to layoffs and higher unemployment rates. Conversely, during economic expansions, demand increases, and unemployment typically decreases. - **Structural Unemployment**: This occurs when there is a mismatch between the skills of the workforce and the needs of the job market, often due to technological changes or shifts in the economy. - **Natural Unemployment**: This is the sum of frictional and structural unemployment that exists even in a healthy economy. - **Frictional Unemployment**: This type occurs when individuals are temporarily unemployed while transitioning from one job to another or entering the workforce for the first time. Thus, the correct answer is (2) cyclical unemployment.