Final answer:
Frictional unemployment is always present, even in well-functioning labor markets, as part of the natural rate of unemployment and occurs when workers are transitioning between jobs.
Step-by-step explanation:
Frictional unemployment occurs as workers move between jobs, and it is an inherent part of a healthy economy even when labor markets are functioning well. It involves the time it takes for employers and job seekers to find a match for their needs, which can entail gathering information on job openings, attending interviews, and making relocation decisions. This type of unemployment represents a period of search and transition, and is different from structural unemployment, which is a mismatch of skills with job requirements, and cyclical unemployment, which is related to the economic cycle.
Therefore, the correct answer to the question about frictional unemployment is A. Frictional unemployment is present even when labor markets are working well. It is a component of the natural rate of unemployment, which includes both frictional and structural unemployment, and exists even when the economy is not in recession and is producing at potential GDP.