Give an example o f a price that is sticky in the short run but fl exible in the long run.
Give an example o f a price that is sticky in the short run but fl exible in the long run.
Give an example o f a price that is sticky in the short run but fl exible in the long run.
Solution
the economist are argued that the aggregate output and the price level are short run will be stickey. we know that in the short run the agregate price levels are flexible and the nominal wages are stickey. in the explanation the agregate supply are horiontal, and some of the nominal wages are flexible in the short run when ther the employees are not bid personall commitment with the thier employers.
the nominal wages are average wages of the employees.when nominal wages are falls when the overall unemployment will be increased. for example- when the nominal wages are declined during the depression periode
some of the goods and services are gradually declaines when then price sof goods and services will be decreased. most of the lexury goods cut btheir prices when the prices are sticky in the short run.
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Example of price sticky in short run but flexible in long run
1. Give an example o f a price that is sticky in the short run but fl exible in the long run.
Give an example o f a price that is sticky in the short run but fl exible in the long run.
Give an example o f a price that is sticky in the short run but fl exible in the long run.
Solution
the economist are argued that the aggregate output and the price level are short run will be
stickey. we know that in the short run the agregate price levels are flexible and the nominal
wages are stickey. in the explanation the agregate supply are horiontal, and some of the nominal
wages are flexible in the short run when ther the employees are not bid personall commitment
with the thier employers.
the nominal wages are average wages of the employees.when nominal wages are falls when the
overall unemployment will be increased. for example- when the nominal wages are declined
during the depression periode
some of the goods and services are gradually declaines when then price sof goods and services
will be decreased. most of the lexury goods cut btheir prices when the prices are sticky in the
short run.
