The "No - Markets Fail Often" Camp Argues That in a Recessionary

question 216

Multiple Choice

The "No - Markets Fail Often" camp argues that in a recessionary gap, all of the following will happen except,

• A) workers and employers accept unemployment instead of wage cuts.
• B) consumer spending increases.
• C) savings increase in loanable funds markets.
• D) falling output creates pessimistic expectations that decrease business investment.
• E) wages in labour markets are sticky.