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:

Market Value

The price at this moment for buying or selling an asset or service in the market.

Shares Held

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Volatile Stock

Shares of a company that exhibit significant fluctuations in price over short periods of time due to various factors.