In the Long Run, Nominal Wages Are

question 273

Multiple Choice

In the long run, nominal wages are:

• A) sticky downward but flexible upward.
• B) sticky upward but flexible downward.
• C) sticky both upward and downward.
• D) flexible, because contracts and informal agreements are renegotiated in the long run.

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Definitions:

Price Discrimination

Price discrimination is the strategy of selling the same product at different prices to different groups of consumers, often based on their willingness to pay, location, or purchase volume.

Disguised Subsidy

Financial support given to industries or businesses in indirect ways, not easily identifiable as traditional subsidies, to lower their costs or increase their competitiveness.

Consumer Surplus

The gap between the total sum consumers are prepared and financially able to spend on a good or service and the sum they actually spend.

Legal

Pertaining to or conforming to the laws of a country or the legality of a situation or activity.