Efficiency wages, above equilibrium minimum wage rates, and higher union wages are likely to
A) reduce the equilibrium real wage rate.
B) decrease the natural unemployment rate.
C) increase the equilibrium real wage rate.
D) increase cyclical unemployment.
E) increase the natural unemployment rate.
Question 2
According to this Application, for approximately 12 million homeowners in 2012, the amount owed on mortgages was higher than the actual value of the homes. Homeowners who find themselves in this situation are said to be
A) financially grounded. B) subprime borrowers.
C) underwater. D) shadow mortgage holders.
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