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The Reason for Disequilibrium in the Short Run in the Keynesian

Question 18

Multiple Choice

The reason for disequilibrium in the short run in the Keynesian model of nominal-wage rigidity is


A) employers and employees do not know about the actual relative prices.
B) the contracts according which wages are set for a specific period and can be negotiated only when the contract term ends.
C) unions which supports fixed wages during the contracts.
D) that prices and wages move together in the long run.

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