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

question 29

Multiple Choice

The sticky-wage theory of the short-run aggregate supply curve says that the quantity of output firms supply will increase if

• A)the price level is higher than expected making production more profitable.
• B)the price level is higher than expected making production less profitable.
• C)the price level is lower than expected making production more profitable
• D)the price level is higher than expected making production less profitable

---

Definitions:

Net Income

The amount of profit remaining after all operating expenses, interest, taxes, and preferred stock dividends have been deducted from total revenue; also known as net profit.

Dividend

A portion of a company's earnings distributed to shareholders, usually in the form of cash payments or additional shares.

Par Common Stock

Par common stock is the nominal or face value assigned to common shares in the corporate charter, often impacting the accounting treatment of stock issuance.

Treasury Stock

Shares that were issued and subsequently bought back by the issuing company, reducing the amount of outstanding stock on the open market.