Workers and firms both expect that prices will be 2.5% higher next year than they are this year. As a result
A) workers will be willing to take lower wages next year, but not lower than a 2.5 percent decrease.
B) aggregate demand will increase by 2.5%.
C) the purchasing power of wages will rise if wages increase by 2.5%.
D) the short-run aggregate supply curve will shift to the left as wages increase.
D
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How much mobility has there been through the income quintiles since 2007?
What will be an ideal response?