Question on: JAMB Economics - 2023
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Which of the following is the resultant effect of a fall in the profit margin of producers in an economy?
A
Unemployment will fall
B
Unemployment will remain constant
C
Unemployment will increase
D
Unemployment will fluctuate
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Correct Option: C
The resultant effect of a fall in the profit margin of producers in an economy is that unemployment will increase. A decrease in profit margins can lead to cost-cutting measures by businesses, including reductions in workforce, which results in an increase in unemployment.
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