If the Economy Is Experiencing an Expansionary Gap,which of the Following

question 34

Multiple Choice

If the economy is experiencing an expansionary gap,which of the following will occur in the long run?

• A)Workers will negotiate nominal wage increases that will shift the SRAS curve to the left.
• B)Workers will negotiate nominal wage increases that will shift the SRAS curve to the right.
• C)Employers will negotiate lower nominal wages (relative to prices)that will shift the SRAS curve to the right.
• D)Employers will negotiate lower nominal wages (relative to prices)that will shift the SRAS curve to the left.
• E)Aggregate demand will fall because workers' incomes are rising.

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Definitions:

Equitable Remedy

A type of judicial relief that requires a party to act or refrain from acting in a certain way, often employed when monetary damages are insufficient for justice.

Imposed

Something that is enforced or applied authoritatively, often without the consent of those affected.

Intended Beneficiaries

Individuals or entities who, although not party to a contract, are intended by the contracting parties to benefit from the contract's performance.

Privity of Contracts

A doctrine in contract law that states that contracts are binding only upon the parties signing the agreement, and no third party can enforce or be obliged by the contract.