According to the Sticky Wage Theory, Which of the Following

question 205

Multiple Choice

According to the sticky wage theory, which of the following is consistent with a more-than-expected increase in the price level?

• A)Real wages rise, so firms will hire more workers.
• B)Real wages rise, so firms will hire fewer workers.
• C)Real wages fall, so firms will hire more workers.
• D)Real wages fall, so firms will hire fewer workers.

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