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QUESTION:
If unemployment insurance were so generous that it paid laid-off workers 95 percent of their regular salary, _______.
a. the official unemployment rate would probably understate true unemployment
b. the official unemployment rate would probably overstate true unemployment
c. there would be no impact on the official unemployment rate
d. frictional unemployment would fall
e. none of the answer choices are correct
ANSWER:
b. the official unemployment rate would probably overstate true unemployment
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