As the proportion of labor contracts that index wages to prices declines, we would expect that
A) a reduction in the unemployment rate will now have a smaller effect on inflation.
B) the natural rate of unemployment will increase.
C) the natural rate of unemployment will decrease.
D) nominal wages will become more sensitive to changes in unemployment.
A
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A change in tax rates
A) has a larger multiplier effect the smaller the tax rate. B) has a less complicated effect on GDP than does a tax cut of a fixed amount. C) will not affect disposable income. D) will not affect the size of the multiplier.
Which of the following is a major reason for offshoring?
a. The gradual reduction in information and communication technologies. b. The fragmentation of production processes. c. The gradual decline in worldwide competition. d. All of the above are major reasons for offshoring.
When the process of entry and exit has ended in a competitive market, are firms' profits positive, negative, or zero?
Governments usually provide national defense from tax funds because
What will be an ideal response?