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blackmamba24 Group Title

Suppose the world price of cotton falls. The demand for labor among cotton-producing firms in Texas will (increase/decrease) . The demand for labor among textile-producing firms in South Carolina, for which cotton is an input will (increase/decrease) . Both workers and firms will need some time to adjust to the new conditions. The unemployment resulting from such sectoral shifts in the economy is best described as ( structural/cyclical/frictional/seasonal)… I think its increase and decrease respectively but no intuition as to why.

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