With a Fixed Nominal Wage the SAS Curve Is Positively

question 10

Multiple Choice

With a fixed nominal wage the SAS curve is positively sloped because

• A)an increase in P decreases the real wage and raises profits if output is increased.
• B)A decrease in P decreases the real wage and raises profits if output is increased.
• C)business firms are responsive to interest rates.
• D)the marginal leakage rate is small.

---

Definitions:

Loftus

Referring to Elizabeth Loftus, a prominent cognitive psychologist known for her research on human memory, particularly in the context of eyewitness testimony.

Tip-Of-The-Tongue

A cognitive phenomenon involving the temporary inability to retrieve a word from memory, accompanied by a feeling that retrieval is imminent.

Partial Retrieval

The process of recalling only a portion of the information from memory, not the entire content.

Retrieval Failure

The inability to recall information from memory due to missing cues or encoding issues.