In the Short Run, Nominal Wages and Other Input Prices

question 77

Multiple Choice

In the short run, nominal wages and other input prices are assumed to be

• A) unresponsive to product price-level changes, but in the long run they are assumed to be responsive.
• B) unresponsive to product price-level changes, and in the long run they are assumed to be unresponsive also.
• C) responsive to product price-level changes, but in the long run they are assumed to be unresponsive.
• D) responsive to product price-level changes, and in the long run they are assumed to be responsive also.

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Definitions:

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Business Contract

A legally binding agreement between two or more parties that outlines the terms and conditions of business transactions.

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A legal system based on written codes and statutes, as opposed to common law, which is based on judicial decisions and precedent.

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