A proportionate increase in the price level and the money wage in the classical model
a. increase labor supply.
b. decrease labor supply.
c. leave labor supply unchanged.
d. affect labor supply but the direction of the effect is uncertain.
Question 2
In the new classical view, an anticipated decrease in government spending would be expected to
a. lower output and the price level.
b. lower output but leave the price level unchanged.
c. leave output unchanged and raise the price level.
d. leave output unchanged and lower the price level.
e. leave both output and the price level unchanged.
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Normal change in sea level
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