When you purchase a bond in the secondary market, you are lending money directly to the borrower

In the aggregate demand and aggregate supply model, sticky wages, sticky prices, and misperceptions about relative prices

a. have temporary effects. b. explain why the short run aggregate supply curve might shift. c. explain why the aggregate demand curve is downward sloping. d. explain monetary neutrality.

When does a higher wage rate lead to an increase in the number of work hours supplied by laborers?

a. Always. b. When the substitution effect outweighs the income effect. c. When the income effect outweighs the substitution effect. d. Never.