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19) When the automobile replaced horse-drawn carriages as the principal means of transportation, firms producing horsedrawn carriages went bankrupt and permanently laid off all their workers, thereby increasing

A) frictional unemployment. B) structural unemployment.
C) cyclical unemployment. D) frictional and cyclical unemployment.

User Idleberg
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Final answer:

The type of unemployment that applies in this situation is structural unemployment, as the shift from horse-drawn carriages to automobiles led to a mismatch between available jobs and the skills of the workers.

Step-by-step explanation:

In this case, the unemployment type that applies to the workers who were laid off when the automobile replaced horse-drawn carriages as the principal means of transportation is structural unemployment. Structural unemployment occurs when there is a shift in the structure of the economy, leading to a mismatch between available jobs and the skills or locations of workers.

In this situation, the firms producing horse-drawn carriages went bankrupt because their product was no longer in demand. As a result, they had to lay off all their workers. The workers who were trained and specialized in making horse-drawn carriages faced difficulty in finding new jobs because their skills were no longer needed.

This is an example of structural unemployment because the workers' unemployment is a result of a structural change in the economy, specifically, the shift from horse-drawn carriages to automobiles as the principal means of transportation.

User ErhWen Kuo
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