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Economics (AS & A Level) · Oct / Nov 2021 · Paper 31 · Question 26

9708Aggregate Demand and Aggregate Supply analysis

What are the assumptions made by Keynesians in relation to wages and investment?

  1. Awages flexible; investment interest rates elastic
  2. Bwages flexible; investment interest rates inelastic
  3. Cwages not flexible; investment interest rates elastic
  4. Dwages not flexible; investment interest rates inelastic

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Correct answer: D. wages not flexible; investment interest rates inelastic

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