If the economy is in long-run equilibrium,
A) prices will rise but wages will remain constant.
B) neither prices nor wages will change.
C) it is producing Natural Real GDP.
D) prices will remain constant but wages may rise.
E) b and c
E
You might also like to view...
In a small European country, it is estimated that changing the level of capital from $8 million to $10 million will increase real GDP from $2 million to $3 million
If the number of hours worked in the labor force does not change, what does this information tell you about the slope of the per-worker production function in this range? A) The slope is -2. B) The slope is 1/2. C) The slope is 2. D) The slope is 4.
As the price level falls
a. people will want to hold more money, so the interest rate rises. b. people will want to hold more money, so the interest rate falls. c. people will want to hold less money, so the interest rate falls. d. people will want to hold less money, so the interest rate rises.