Suppose the world price of cotton rises substantially. the demand for labor among cotton-producing firms in texas will the demand for labor among textile-producing firms in south carolina, for which cotton is an input, will the temporary unemployment resulting from such sectoral shifts in the economy is best described as unemployment.

Increase; Decrease; Frictional

Explanation:

An increase in the world price of cotton will encourage cotton producers to increase output. To increase output firms will need more workers. As a result, the demand for labor in these firms will increase.  

Though as the price of cotton increases, the cost of producing cotton textiles will increase. This will cause the production of textiles to decrease. The demand for labor in textile producing firms will decrease.  

The unemployment by such sectoral shifts can be referred to as frictional unemployment. This because the workers will be shifting from textile firms to cotton-producing firms.

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