Based on wage setting behavior,we know that an increase in the unemployment rate will cause

Question

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When the unemployment rate increases, there are more job seekers and fewer job openings, which gives employers greater bargaining power in wage negotiations. As a result, employers may offer lower wages, leading to a reduction in the real wage. Therefore, an increase in the unemployment rate typically results in a reduction in the real wage.

Based on Wage Setting Behavior,we Know That an Increase in the Unemployment