Wage Contracts, Efficiency Wages, and the Minimum Wage Are Explanations

question 13

Multiple Choice

Wage contracts, efficiency wages, and the minimum wage are explanations for why

• A)competition results in price wars.
• B)wages tend to be inflexible downward.
• C)the aggregate demand curve slopes downward.
• D)there is little support for the existence of a real-balances effect.

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Definitions:

Long-Term Investments

Assets that are more than 1 year old and are carried on the balance sheet at cost or book value with no appreciation.

Stocks

Shares of ownership in a company that represent a claim on the company's earnings and assets, which can be bought and sold in the stock market.

Bonds

The connections with family, friends, and others who have a similar cultural background or ethnicity.

Balance Sheet

A financial statement that reports a company's assets, liabilities, and shareholders' equity at a specific point in time.