Question

Sectoral changes in demand a. and firms paying wages above equilibrium to attract a better pool of candidates both create frictional unemployment. b. create structural unemployment, while firms paying wages above equilibrium to attract a better pool of candidates creates frictional unemployment. c. create frictional unemployment, while firms paying wages above equilibrium to attract a better pool of candidates creates structural unemployment. d. and firms paying wages above equilibrium to attract a better pool of candidates both create structural unemployment.

Answer 1

Answer: create frictional unemployment, while firms paying wages above equilibrium to attract a better pool of candidates creates structural unemployment. (C)

Step-by-step explanation:

Frictional unemployment also called search unemployment is the time that is spent between jobs when a worker is looking for a job. This can be as a result of sectoral changes in demand.

Structural unemployment is caused by a mismatch between skills that an employee has to offer and the skills that is required of the employees by their employers. Structural unemployment is as a result of economic development and technological changes. This will make firms pay above the equilibrium wages to attract better employees.