The Sticky-Wage Theory of the Short-Run Aggregate Supply Curve Says

question 52

Multiple Choice

The sticky-wage theory of the short-run aggregate supply curve says that when the price level is lower than expected,

• A)relative to prices wages are higher and employment rise.
• B)relative to prices wages are higher and employment falls.
• C)relative to prices wages are lower and employment rises.
• D)relative to prices wages are lower and employment falls.

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Definitions:

Begging the Question

A logical fallacy where the conclusion of an argument is assumed in one of the premises, often leading to circular reasoning.

Red Herring

A distraction or misleading piece of information that diverts attention away from the main issue or argument.

Naturalistic Fallacy

A fallacy based on the assumption that what is natural is good.

Birth Control

Methods or devices used to prevent pregnancy as part of family planning.