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In the Graphs Below, QP Refers to the Economy's Potential

Question 131

Multiple Choice

In the graphs below, QP refers to the economy's potential output level. In the graphs below, Q<sub>P</sub> refers to the economy's potential output level. Refer to the graphs above. Graph A is constructed on the basic assumption that: A) The price level is not flexible B) Nominal wages are unresponsive to price-level changes C) Real output is unresponsive to price-level changes D) Unemployment is unresponsive to price-level changes Refer to the graphs above. Graph A is constructed on the basic assumption that:


A) The price level is not flexible
B) Nominal wages are unresponsive to price-level changes
C) Real output is unresponsive to price-level changes
D) Unemployment is unresponsive to price-level changes

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