If a short-run equilibrium with a recessionary gap persists:
A) low unemployment rates will raise wage rate increases and employment.
B) high unemployment rates will raise wage rate increases and AD.
C) high unemployment rates will reduce wage rate increases and shift AS down.
D) unemployment at the natural rate has no effect on wage rates or AS.
Correct Answer:
Verified
Q52: The short-run AS curve is drawn on
Q53: The short-run AS curve is upward-sloping because:
A)
Q54: The aggregate supply (AS) curve will shift
Q55: When there is a recessionary gap, wage
Q56: When there is an inflationary gap:
A) upward
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