Assume That the Economy Is Initially Operating at the Natural

question 13

Multiple Choice

Assume that the economy is initially operating at the natural level of output. An increase in the minimum wage will cause:

• A) an increase in the nominal wage in the medium run.
• B) no change in the real wage in the medium run.
• C) an increase in the real wage in the medium run.
• D) a decrease in the real wage in the medium run.
• E) a decrease in the nominal wage in the medium run.

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Definitions:

Autonomic Nervous System

The part of the nervous system that controls involuntary actions of the body, such as heart rate, digestion, and respiratory rate.

Schachter And Singer Theory

A psychological model that suggests emotions are determined by physiological arousal and cognitive labeling of the cause of that arousal.

James-Lange Theory

A hypothesis suggesting that emotional experience is the result of physiological responses to external stimuli.

Epinephrine

A hormone and neurotransmitter also known as adrenaline, involved in the body's fight-or-flight response.