In the short run, if the price level increases, then nominal wages:
A. Stay fixed, therefore firms' revenues and profits will increase
B. Stay fixed, and the firms' revenues and profits also stay the same
C. Increase, causing firms' revenues and profits to fall
D. Decrease, causing firms' revenues and profits to rise
A. Stay fixed, therefore firms' revenues and profits will increase
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The price of a PC falls or the price of an MP3 download rises? (Draw the diagrams!)
What will be an ideal response?
France is capital abundant and Italy is labor abundant. Shoes are labor intensive and wheat is capital intensive
Draw diagrams to illustrate the pre- and post-trade equilibria for each of the two countries including the production points, the consumption points, the international price, and the volumes of exports and imports for each. Be sure to identify which country has comparative advantage in which good. Which factors gain and which lose when trade is opened between the two countries? Explain carefully.
If nominal GDP in 2012 was less than real GDP in 2012, we know for certain that
A) the price level in 2012 was greater than the price level in the base year. B) real GDP in 2012 was greater than real GDP in the base year. C) the price level in 2012 was less than the price level in the base year. D) real GDP in 2012 was less than real GDP in the base year.
The financial capital of a firm includes the: a. service provided by its accountants
b. credit cards provided to its top executives. c. equity and bonds issued by it. d. loans accepted from banks. e. computers purchased for its office staff.