Suppose the Wage Rate in the Labor Market Is $8

question 76

Multiple Choice

Suppose the wage rate in the labor market is $8 and more people entered the labor force, which of the following statements is correct?

• A) If wages are flexible, then wages will increase.
• B) If wages are sticky, the unemployment rate increases.
• C) If wages are sticky, the unemployment rate stays the same.
• D) If wages are flexible, the unemployment rate increases.

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Definitions:

Disinhibition

The reduction of inhibition, resulting in spontaneous behavior without consideration for societal norms or potential risks.

Inhibition

The process of restraining or suppressing a behavior, emotion, or impulse.

Fearful

Characterized by feeling afraid or anxious; experiencing fear.

Nervous

Experiencing feelings of anxiety, agitation, or tension, often as a response to stress or uncertainty.