Sectoral shifts:
A) lead to wage rigidity.
B) explain the payment of efficiency wages.
C) depend on the level of the minimum wage.
D) make frictional employment inevitable.

Question

Quizplus · Accepted Answer

Sectoral shifts, which refer to changes in the demand for workers across different sectors of the economy, can lead to frictional unemployment as workers may need time to search and match for new job opportunities. This is why option D is the best answer as it states that sectoral shifts make frictional employment inevitable. The other options are not directly related to sectoral shifts - wage rigidity can be caused by various factors beyond sectoral shifts, the payment of efficiency wages is a strategy used by employers to increase worker productivity (not necessarily related to sectoral shifts), and the level of the minimum wage may be influenced by various political and economic factors beyond sectoral shifts.

Sectoral Shifts