Suppose Workers' and Firms' Expectations of the Price Level and Productivity

question 25

Multiple Choice

Suppose workers' and firms' expectations of the price level and productivity are accurate.In this case,an increase in productivity will cause which of the following?

• A)an increase in both the real wage and the natural rate of unemployment
• B)a decrease in both the real wage and the natural rate of unemployment
• C)an increase in the real wage and no change in the natural rate of unemployment
• D)a decrease in the real wage and an increase in the natural rate of unemployment
• E) none of the above

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Definitions:

Connectives

Logical operators used in sentences to link together propositions, thereby establishing a logical relationship between them; these include conjunctions, disjunctions, and implications.

Main Connective

The primary logical operator in a logical formula which determines the overall structure of the proposition.

Atomic Statements

Basic propositions that express a single idea or claim and serve as the foundation of complex logical structures.

Main Components

Fundamental parts or elements that make up a complex system or concept.