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Suppose the Money Wage Rate and the Price Level Both

Question 79

Multiple Choice

Suppose the money wage rate and the price level both fall by 5 percent. As a result,


A) the quantity of labor demanded decreases.
B) people are worse off and there is more unemployment.
C) the quantity of labor demanded increases.
D) the quantity of labor demanded does not change because there is no change in the real wage.

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