For the coordination failure model to work, it must be the case that the aggregate labor demand curve must be
A) upward sloping and steeper than the labor supply curve.
B) upward sloping and flatter than the labor supply curve.
C) downward sloping and steeper than the labor supply curve.
D) downward sloping and flatter than the labor supply curve.
A
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Suppose real GDP was 100 in year 1 and 105 in year 2. The growth rate of real GDP is
A) 0.5 percent. B) 1.5 percent. C) 2.5 percent. D) 5 percent.
State and briefly explain whether or not the empirical evidence generally supports the belief that there is a fixed trade-off between unemployment and inflation, such that monetary policymakers can achieve the combination they prefer
What will be an ideal response?
The principal mechanism for directly changing the reserves of the banking system is:
A. The discount rate. B. The reserve requirement. C. Open-market operations. D. The federal funds rate.
Market failure occurs when:
A. markets have perfect information. B. markets do not produce the most efficient outcome. C. companies merge to increase efficiency. D. companies are too efficient.