Slower Real Wage Growth Since the 1970s Accompanied by Rapid

question 11

Multiple Choice

Slower real wage growth since the 1970s accompanied by rapid job growth can be explained by:

• A) skill-biased technological change.
• B) globalization.
• C) a productivity slowdown accompanied by an increase in the labor supply.
• D) a productivity slowdown accompanied by a decrease in the labor supply.

---

Definitions:

Long-run Equilibrium

A state in which economic forces such as supply and demand are balanced, and all inputs and outputs in the economy are fully adjusted to these conditions over a long period.

Pure Competition

A theoretical market structure with a large number of sellers and buyers, identical products, and no barriers to market entry or exit, promoting efficient pricing.

Minimum

The lowest allowable or possible amount, level, or number in a given set of circumstances.

Allocative Efficiency

Refers to a state in which resources are distributed in a way that maximizes the net benefit to society, ensuring that goods and services are produced at the right quantities to meet consumer preferences.