Chapter 9 - From the short to the Medium run: The IS-LM-PC Model Flashcards
1
Q
output fluctuations (business cycles)
A
movements in output around its trend
2
Q
economic fluctuations
A
results of shocks and their dynamic effects
3
Q
can more frequent wage adjustments preserve higher levels of real wage?
A
no, just possible to set up higher inflation
4
Q
factors of labor-market rigidities
A
a) generous system of unemployment insurance
b) high degree of employment protection
c) minimum wages
d) bargaining rules, such as extension agreements
