The Equilibrium Effects of a Temporary Increase in Total Factor

question 54

Multiple Choice

The equilibrium effects of a temporary increase in total factor productivity include

• A) an increase in the real wage and an increase in the real interest rate.
• B) an increase in the real wage and a decrease in the real interest rate.
• C) a decrease in the real wage and an increase in the real interest rate.
• D) a decrease in the real wage and a decrease in the real interest rate.

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Definitions:

Provisional Credit

Temporary credit issued by a bank to an account holder, often while disputes or errors are being resolved.

Dishonor

In finance, the refusal or inability of a drawee of a negotiable instrument to pay the amount due upon presentment.

Actual Payment

The real transfer of funds from one party to another, completing a transaction or settling a debt.

EFT Payments

Electronic funds transfer payments involve moving money from one account to another without the exchange of physical money.