For This Question,assume Expectations of P and a Are Correct

question 60

Multiple Choice

For this question,assume expectations of P and A are correct.Now suppose that there is a 3% reduction in A.Given this information,which of the following will occur?

• A)the PS relation will shift up by 2%.
• B)the WS relation will shift down by less than 2%.
• C)the WS relation will shift down by 2%.
• D)there will be no change in the real wage.

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Definitions:

Equity Multiplier

An equity multiplier is a financial ratio that measures the proportion of a company’s total assets financed by its shareholders' equity, demonstrating the degree of financial leverage being used.

M

Typically represents the mean or average in statistical contexts.

Arithmetic Mean

A measure of central tendency calculated by summing all the scores and dividing by the number of scores. See Mean.

Mode

The number that occurs most often in a collection of data.