An Economy May Not Quickly and Automatically Eliminate a Recessionary

question 147

Multiple Choice

An economy may not quickly and automatically eliminate a recessionary output gap because wages

• A)never change in response to changes in the demand for labour.
• B)have a tendency to be sticky downward.
• C)have a tendency to fall too quickly.
• D)have a tendency to rise too quickly.
• E)are flexible but prices have a tendency to be sticky downward.

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Definitions:

Variance

A numerical indicator that shows the distribution or variability of a dataset around its average value.

SPSS Output

The results and data analyses generated by the Statistical Package for the Social Sciences software after processing information.

Correlation Coefficient

A numerical measure of some type of correlation, meaning a statistical relationship between two variables, ranging from -1 to 1.

Mean

A type of average calculated by summing values and dividing that sum by the number of values.