Question

In: Economics

Employers often end up laying off more workers during a recession because of​ ________. A. flexible...

Employers often end up laying off more workers during a recession because of​ ________. A. flexible wages B. downward rigidity of wages C. higher corporate taxes D. a tight monetary policy

Amanda lives in France. She received​ $5,000 as a wedding gift from a relative living in the United States. This is an example of​ a(n) ________.

A.

transfer payment to France

B.

export to France

C.

import from France

D.

factor payment to France

Solutions

Expert Solution

Employers lay off more workers during a recession due to downward rigidity of wages. There is a price floor on wages. During recession, the labour supply exceeds labour demand and requires for a fall in wages. But wage rigidity does not allow this as a result of which workers are laid off.

When Amands recieves a wedding gift from a relative in US, it is an example of transfer payment. The payment is not being made is exchange of any goods or services. It is just sort of a redistribution of income and considered as a separate category.

Rahul Sunny answered 2 years ago
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