The Economy's Long-Run AS Curve Assumes That Wages and Other

question 268

Multiple Choice

The economy's long-run AS curve assumes that wages and other resource prices

• A) eventually rise and fall to match upward or downward changes in the price level.
• B) are flexible upward but inflexible downward.
• C) rise and fall more rapidly than the price level.
• D) are relatively inflexible both upward and downward.

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Definitions:

Geometric Mean

A type of mean or average, which indicates the central tendency of a set of numbers by using the product of their values (as opposed to the arithmetic mean which uses their sum).

Weighted Mean

The mean of a data set that accounts for the importance or weight of each value.

Population Parameter

A numerical value that describes a characteristic of an entire population, such as its mean or standard deviation.

Sample Statistic

A numerical measure that describes some characteristic of a sample, such as the sample mean or sample standard deviation.