Figure 7-3
-Refer to Figure 7-3. Suppose that the economy is in long-run equilibrium at point A. Now suppose net exports increase. In the short run,
A) unemployment is above its natural level.
B) those who were cyclically unemployed will now find jobs at the going nominal wage rate.
C) those who were structurally or frictionally unemployed will now find jobs at the going nominal wage rate.
D) the nominal wage rate rises.

Question

Figure 7-3 
-Refer to Figure 7-3. Suppose that the economy is in long-run equilibrium at point A. Now suppose net exports increase. In the short run,
A) unemployment is above its natural level. 
B) those who were cyclically unemployed will now find jobs at the going nominal wage rate. 
C) those who were structurally or frictionally unemployed will now find jobs at the going nominal wage rate. 
D) the nominal wage rate rises.

Quizplus · Accepted Answer

The Answer of Figure 7-3 
-Refer to Figure 7-3. Suppose that the economy is in long-run equilibrium at point A. Now suppose net exports increase. In the short run,
A) unemployment is above its natural level. 
B) those who were cyclically unemployed will now find jobs at the going nominal wage rate. 
C) those who were structurally or frictionally unemployed will now find jobs at the going nominal wage rate. 
D) the nominal wage rate rises.

Figure 7-3 -Refer to Figure 7-3. Suppose That the Economy Is in Economy