A Rise in Wage Rates

question 93

Multiple Choice

A rise in wage rates

• A) causes the AD curve to shift leftward.
• B) causes the short-run aggregate supply (SRAS)curve to shift rightward.
• C) does not affect the present position of the SRAS curve.
• D) causes the AD curve to shift rightward.
• E) causes the SRAS curve to shift leftward.

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Definitions:

Discount Factor

A factor employed in the discounted cash flow (DCF) methodology to calculate the current value of anticipated cash flows.

Payback Period

The length of time it takes for an investment to generate cash flows sufficient to recover the initial cost of the investment.

Initial Investment

The initial amount of money invested in a project or business, often used to start or acquire it.

Incremental Annual Revenues

The additional revenue a business generates from making specific changes, such as launching a new product or entering a new market, on an annual basis.