In the above figure, if the economy is at point A, which of the following is true?
A. Point A is the long-run equilibrium point.
B. The economy is in a recession.
C. Money wages can be expected to fall.
D. The economy might be at point A as a result of a recent cut in the tax rate.
Answer:D
In the above figure, if the economy is at point A, which of the following is true?
A. Point A is the long-run equilibrium point. B. The economy is in a recession. C. Money wages can be expected to fall. D. The economy might be at point A as a result of a recent cut in the tax rate.