If wages are "sticky", a decline in the price level will
A) raise the real wage and lower the quantity demanded of labor.
B) lower the real wage and lower the quantity supplied of labor.
C) raise the real wage and lower the quantity supplied of labor.
D) a and b
E) none of the above
A
Economics
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How is a monopolistically competitive firm likely to respond to fluctuations in demand in the short run?
A) by selling more or less at the posted price B) by changing prices C) by reducing menu costs D) by increasing menu costs
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In the classical model, changes in interest rates will always ensure that
A) consumption equals production. B) saving equals investment. C) consumption equals investment. D) consumption equals income.
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