Ifwagesaresticky a unemployment decreases b

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Unformatted text preview: o clear the labor market are likely to believe that the aggregate supply curve is vertical. Answer: FALSE Diff: 2 Topic: The Classical View of the Labor Market Skill: Conceptual AACSB: Reflective Thinking 2) If the actual unemployment rate is below NAIRU, the change in the inflation rate will be positive. Answer: TRUE Diff: 2 Topic: The Classical View of the Labor Market Skill: Definition 3) The view of the labor market holds that unemployment in the economy consists of frictional and structural classical unemployment. Answer: TRUE Diff: 1 Topic: The Classical View of the Labor Market Skill: Definition 4) Classical s believe that economic policies are ineffective because they don't affect aggregate demand in the economist economy. Answer: FALSE Diff: 1 Topic: The Classical View of the Labor Market Skill: Fact 5) If firms pay wages higher than the market clearing wage, their profits will be reduced. Answer: FALSE Diff: 2 Topic: The Classical View of the Labor Market Skill: Conceptual AACSB: Reflective Thinking 14.3 Expla 1 M ul ti pl e C 1) h o i c e Suppose the wage rate in the labor market is $15 and the demand for labor decreases. If wages are sticky, A) unemployment decreases. B) unemployment increases. C) une...
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