Why Is Persistent Unemployment a Possibility in the Keynesian Model

question 73

Multiple Choice

Why is persistent unemployment a possibility in the Keynesian model but NOT in the classical model?

• A) The Keynesian model assumes that people work for motives other than those of earning an income for themselves and supporting a family.
• B) The Keynesian model assumes that nominal wages are inflexible downward.
• C) The Keynesian model assumes that the level of real GDP is inflexible.
• D) The Keynesian model assumes that workers can lose their jobs to foreign competition during economic downturns.

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Weekly Salary

Weekly salary refers to the amount of money an individual earns per week for their labor or services.

Commission

Remuneration for sales or service personnel, calculated as a fixed percentage of the sales they accomplish.

Bonus

An extra payment made to an employee beyond their normal salary, often reflecting their performance or company success.

Gross Cost

The total cost incurred before any deductions, such as discounts or rebates, are applied, representing the full price of a product or service.