What type of demonstration is this? Suppose the price level - ProProfs Discuss
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What type of demonstration is this? Suppose the price level falls. Because of fixed nominal wage contracts, firms become less profitable and they cut back on production.



A. Sticky-wage theory of the short-run aggregate-supply curve
B. Sticky-price theory of the short-run aggregate-supply curve
C. Misperceptions theory of the short-run aggregate-supply curve
D. Classical dichotomy theory of the short-run aggregate-supply curve

This question is part of Macroeconomics [Ch. 2
Asked by Emy_, Last updated: Apr 27, 2020

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John Smith

John Smith

Answered Mar 13, 2017

Sticky-wage theory of the short-run aggregate-supply curve
 

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