Suppose the Economy Is in Long-Run Equilibrium and the Government

question 51

Multiple Choice

Suppose the economy is in long-run equilibrium and the government decreases its expenditures.Which of the following helps explain the logic of why the economy moves back to long-run equilibrium?

• A)as people revise their price-level expectations upward,firms and workers strike bargains for higher nominal wages.
• B)as people revise their price-level expectations upward,firms and workers strike bargains for lower nominal wages.
• C)as people revise their price-level expectations downward,firms and workers strike bargains for higher nominal wages.
• D)as people revise their price-level expectations downward,firms and workers strike bargains for lower nominal wages.

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Definitions:

Homogeneous Employee Groups

Workforce groups composed of individuals with similar characteristics, backgrounds, or attributes, which can impact diversity and inclusivity in the workplace.

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The set of expected behaviors and manners in professional settings, guiding interactions and communication in business.

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The practice of moving a business process or service to a foreign country to capitalize on lower costs or more favorable economic conditions.