In a recessionary gap, the implications of downward wage inflexibility are that there will be
A) further leftward shifts of AD that worsen unemployment.
B) no further leftward shifts of AD, allowing the shifts in SRAS to close the recessionary gap.
C) no further leftward shifts of SRAS, allowing the shifts in AD to close the recessionary gap.
D) no rightward shifts of SRAS, allowing for the possibility of persistent high unemployment.
D
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