Which statement is FALSE?
A) Both frictional and structural unemployment can occur,even if unemployment is at its natural level.
B) Cyclical unemployment is unemployment in excess of the natural rate.
C) A new university graduate looking for that first professional job may be frictionally unemployed.
D) Efficiency wages may cause frictional unemployment.

Question

Quizplus · Accepted Answer

Efficiency wages may cause unemployment, but it would be due to structural unemployment, not frictional. Frictional unemployment occurs when workers are transitioning between jobs or entering the labor market for the first time, while structural unemployment reflects a mismatch between the skills and location of workers and the needs of employers.

Which Statement Is FALSE