Why is it difficult to measure the cyclical properties of the real wage?
A)The composition of employed workers changes over the business cycle.
B)Firms refuse to report data on workers' wages.
C)Workers have money illusion.
D)monetary and fiscal policy intervention
E)Wages are sticky.

Question

Quizplus · Accepted Answer

The composition of employed workers changes over the business cycle, affecting the measurement of real wages' cyclical properties. Different industries and types of jobs may expand or contract at different phases of the business cycle, leading to changes in the overall composition of employment. This can make it difficult to determine if changes in average real wages are due to cyclical economic factors or shifts in the types of jobs that are prevalent at different times.

Why Is It Difficult to Measure the Cyclical Properties of the Real