In the Fooling Model's Labor Market Diagram,from an Initial Intersection

question 117

Multiple Choice

In the fooling model's labor market diagram,from an initial intersection point of the labor supply and demand curves,tracing "southwest" down the labor supply curve shows

• A)what happens to real wages and employment when aggregate demand expands.
• B)what happens to real wages and employment when aggregate demand contracts.
• C)what workers think is happening to real wages if an aggregate demand contraction fools them.
• D)what firms think is happening to real wages if an aggregate demand expansion fools them.