-Assume That the Economy Depicted in Panel (B)of Exhibit 20A-1

question 22

Multiple Choice

-Assume that the economy depicted in Panel (b) of Exhibit 20A-1 is in short-run equilibrium where AD₁ equals SRAS₁.Keynesian theory argues:

• A) nominal wages will fall as long as employment remains above the natural level of unemployment.
• B) lower wages will result in a shift from SRAS₁ to SRAS₂.
• C) long-run equilibrium will be established at Yp and P₁.
• D) government intervention must shift AD₁ rightward to AD₂.

---

Definitions:

Workload

The amount of work assigned to or expected from a person within a specific time frame.

Child Care

The care and supervision of children, typically from infancy through elementary age, by someone other than the child's legal guardians.

Equality Of Power

The ideal or principle that all individuals or groups should have the same amount of power and influence within a society or in specific contexts.

Leisure Time

Free time not taken up by work, chores, or other obligatory activities, allowing for relaxation or pursuit of personal interests.