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In: Economics

Suppose that a country experiences a reduction in productivity—that is, an adverse shock to the production...

Suppose that a country experiences a reduction in productivity—that is, an adverse shock to the production function.

l. What happens to the labor demand curve?

m. How would this change in productivity affect the labor market—that is, employment, unemployment, and real wages—if the labor market is always in equilibrium?

n. How would this change in productivity affect the labor market if unions prevent real wages from falling?

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Rahul Sunny answered 1 year ago
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