Question
According to the classical model, if an excess quantity of labor is supplied at a particular wage level, full employment will be maintained because
A.
the equilibrium wage rate will rise to stimulate spending.
B.
wages will fall rapidly to permit businesses to continue hiring everyone who wants to work.
C.
the government will step in and stimulate spending.
D.
the government will establish special work programs.
A.
the equilibrium wage rate will rise to stimulate spending.
B.
wages will fall rapidly to permit businesses to continue hiring everyone who wants to work.
C.
the government will step in and stimulate spending.
D.
the government will establish special work programs.
Answers
Bot
B. wages will fall rapidly to permit businesses to continue hiring everyone who wants to work.