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Suppose the Economy Is Experiencing a Recessionary Gap

Question 25

Multiple Choice

Suppose the economy is experiencing a recessionary gap. In the long run, if aggregate demand does not change, the following events happen: the money wage rate ________, unemployment ________, and the price level ________.


A) falls; rises; falls
B) falls; falls; falls
C) rises; rises; rises
D) rises; falls; rises

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