The Price Misperception Model Predicts

question 31

Multiple Choice

The price misperception model predicts:

• A)the price level will be countercyclical while in the data the price level is countercyclical.
• B)the nominal quantity of money is procyclical and in the data money is weakly procyclical.
• C)the real wage is procyclical and in the data the real wage is procyclical.
• D)all of the above.

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Definitions:

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