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The Equilibrium Effects of a Prospective Future Increase in Total

Question 4

Multiple Choice

The equilibrium effects of a prospective future increase in total factor productivity include


A) an increase in the real wage and an increase in the real interest rate.
B) an increase in the real wage and a decrease in the real interest rate.
C) a decrease in the real wage and an increase in the real interest rate.
D) a decrease in the real wage and a decrease in the real interest rate.

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