Suppose workers and firms expect the overall price level to increase by 5%. Given this information, we would expect that
A) the nominal wage will increase by less than 5%.
B) the nominal wage will increase by exactly 5%.
C) the nominal wage will increase by more than 5%.
D) the real wage will increase by 5%.
E) the real wage will increase by less than 5%.
B
You might also like to view...
During Prohibition overdose and accidental poisoning due to alcohol _____ and the variation in the quality of alcohol _______
a. fell; fell b. fell; increased c. increased; fell d. increased; increased
Marginal resource cost is defined as the
a. additional cost of producing an additional unit of output b. change in resource employment required to increase the units of output produced c. ratio of marginal revenue product to the market price of the output sold d. additional cost of employing one additional unit of a resource e. ratio of the change in total resource usage to the change in total resource cost
In the short-run macro model, an open-market purchase of bonds by the Fed will
a. raise the interest rate, reduce spending, and increase output b. raise the interest rate, reduce spending, and decrease output c. lower the interest rate, reduce spending, and decrease output d. lower the interest rate, increase spending, and decrease output e. lower the interest rate, increase spending, and increase output
The major reason for the twists, turns, and spurts in the economy's growth path, according to real business cycle theorists, is
a. interest rate fluctuations b. wars c. housing shortages d. a climatic change e. year to year changes in the pace of technological change