If wages are "sticky", a decline in the price level will
A) raise the real wage and lower the quantity demanded of labor.
B) lower the real wage and lower the quantity supplied of labor.
C) raise the real wage and lower the quantity supplied of labor.
D) a and b
E) none of the above
A
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Scarcity: a. occurs only in centrally planned economies
b. will likely be eliminated by technological progress. c. exists only in poor nations. d. occurs if there are insufficient resources to provide for human wants.
Suppose that Venezuela experiences significant capital outflows after a recent election. If the nation had flexible exchange rates, these flows would have had the following effect on the financial account and monetary base
a. Financial account would rise and reserves account would fall. b. Financial account would not change and reserves account would fall. c. Financial account would not change and reserves account would not change. d. Financial account would fall and monetary base would not change. e. Financial account would fall and reserves account would rise.
In Figure 4.1, the demand curve along which price elasticity of demand changes as you move along it is on graph:
A. A. B. B. C. C. D. D.
The labor supply will generally decrease when the income tax rate ________ (if the substitution effect dominates) or transfer payments ________.
A. increases; increase B. increases; decrease C. decreases; increase D. decreases; decrease