For this question, assume that expectations of productivity are slow to adjust. An increase in productivity growth from 1 to 3 will cause
A) an increase in the real wage of 1 and an increase in un.
B) an increase in the real wage of 1 and a reduction in un.
C) an increase in the real wage of 3 and an increase in un.
D) an increase in the real wage of 3 and a reduction in un.
Question 2
Which of the following is a characteristic of bonds?
A) pay zero nominal interest
B) can be used for transactions
C) are sold for a price that varies inversely with the interest rate
D) all of the above
E) none of the above
