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Suppose There Is Unemployment Because of Inadequate Aggregate Demand

Question 54

Multiple Choice

Suppose there is unemployment because of inadequate aggregate demand. If wage rates are "sticky:"


A) increases in aggregate supply will cause the economy to return to full employment.
B) decreases in aggregate supply will cause the economy to return to full employment
C) increases in aggregate demand will cause the economy to return to full employment.
D) cyclical unemployment may persist for a long time.

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