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In a Recessionary Gap,the Implications of Downward Wage Inflexibility Are

Question 85

Multiple Choice

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 gap.
C) no further leftward shifts of SRAS, allowing the shifts in AD to close the gap.
D) no rightward shifts of SRAS, allowing for persistent high unemployment.

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