Multiple Choice
Which one of the following is NOT a criticism of the nominal-wage rigidity assumption?
A) Less than one-third of the labour force in Canada is covered by a labour contract.
B) Some labour contracts contain cost-of-living adjustments.
C) Real wages are procyclical.
D) Both employees and employers make their decisions based on rational expectations.
Correct Answer:
Verified
Correct Answer:
Verified
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