According to many economists, if wages are _________________, the economy _____________ remove itself from a recessionary gap, and thus ____________ government intervention is needed
A) flexible; can; no
B) inflexible; may not; some
C) flexible; may not; some
D) inflexible; can; no
E) a and b
E
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If a market is perfectly competitive and is in long-run equilibrium, which of the following conditions does not hold?
A) Price is equal to the minimum long-run average cost of production. B) Economic profit equals zero. C) The value of the last unit of output produced is equal to the value of the resources used to produce it. D) There is an incentive for additional firms to enter the market because existing firms are earning revenues in excess of the explicit costs of production.
If Y = A × N × (75 + K/N), where K = 1000, N = 20, and A = 10, what happens if K doubles and N doubles?
A) Y is unchanged. B) Y increases by 50%. C) Y doubles. D) Y quadruples.
Approximately what percentage of national income consists of compensation of employees?
A. 10 per cent B. 25 per cent C. 70 per cent D. 95 per cent
Other things equal, a restrictive monetary policy during a period of demand-pull inflation will:
A. lower the interest rate, increase investment, and reduce net exports. B. lower the price level, increase investment, and increase aggregate demand. C. increase productivity, aggregate supply, and real output. D. increase the interest rate, reduce investment, and reduce aggregate demand.