Which of the Following Correctly Explains Why Real Wages May

question 43

Multiple Choice

Which of the following correctly explains why real wages may vary in the short run?

• A) Workers usually prefer inflexible nominal wage agreements.
• B) Since wage bargaining is costless, firms and workers negotiate new wages frequently.
• C) The level of inflation in most economies is stable.
• D) In most industries, nominal wage adjustment is instantaneously linked to inflation.

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Definitions:

Independent Variables

The variable in an experiment that is manipulated or changed to observe its effects on the dependent variable.

Study

The act of devoting time and attention to acquiring knowledge on a subject, through reading, investigation, or practice.

Mode

The value that appears most frequently in a data set.

Mean

The average value in a set of numbers, calculated by dividing the sum of all values by the number of values.