If Wages Are Sticky, Then a Greater Than Expected Increase

question 263

Multiple Choice

If wages are sticky, then a greater than expected increase in the price level

• A)raises the real costs of production, so the short-run aggregate supply curve shifts left.
• B)raises the real costs of production, so the aggregate quantity of goods and services declines.
• C)reduces the real costs of production, so the short-run aggregate supply curve shifts right.
• D)reduces the real costs of production, so the aggregate quantity of good and services rises.

---

Definitions:

Purchases

Transactions involving the acquisition of goods or services in exchange for payment, contributing to a business's inventory or operational needs.

Trial Balance

A financial worksheet that gathers the balances from all accounts into columns of debits and credits, verifying the mathematical accuracy of a company's accounting records.

Ledger

Definition: A book or database in which financial transactions are summarized and categorized to show account balances.

Fees Billed

Represents charges issued by a company for services it has provided, awaiting payment from clients or customers.