The Stickiness of Wages and Prices Will Cause

question 84

Multiple Choice

The stickiness of wages and prices will cause

• A)changes in aggregate demand to have no short-run effects on real GDP.
• B)changes in aggregate demand to have long-run effects on real GDP.
• C)changes in aggregate demand to have both short-run and long-run effects on real GDP.
• D)changes in aggregate demand to have short-run effects on real GDP.

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Definitions:

M

A symbol often representing money supply in economic discussions, including various measures like M1, M2, and M3.

Q

Quantity, frequently used in economic equations and discussions to denote the amount of goods produced or consumed.

PQ

The product of price (P) and quantity (Q), often used in economics to calculate total revenue or expenditure.

P

Typically refers to "Price" in economic models, representing the monetary value assigned to a good or service in the market.