Which of the following is a reason that wages are sometimes "sticky"?
A. Structural unemployment
B. Labor market friction
C. Union wage agreements
D. Technological changes
Answer: C
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Federal Reserve Chairman Volcker's policy to fight inflation
A) led to the 1981-1983 recession, but was ultimately successful. B) led to the 1981-1983 recession, but did not end high inflation due to beggar-thy-neighbor effects. C) was perfectly complemented by Reagan's decrease in fiscal spending. D) led to the 1981-1983 recession and foretold the economic downturn in the mid-1990s. E) led to an immediate depreciation of the dollar.
If the nominal gross domestic product (GDP) for a particular year is $4 trillion and the real GDP for that year is $3 trillion, then the GDP price index is 133
a. True b. False Indicate whether the statement is true or false
Decreases in aggregate demand move the economy down the short run aggregate supply and up the Phillips Curve
a. True b. False Indicate whether the statement is true or false
When aggregate demand decreases rapidly, the economy is likely to experience
a. inflation. b. an economic boom. c. economic growth. d. recession.