If the economy is producing less than the full-employment output level, which of the following would most likely direct the economy back to long-run equilibrium?
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A. B. C. D.A
To understand this question, note that the price of resources is simply a function of supply and demand. This question is implying that demand for resources (i.e. labor) is weak. Holding supply constant, if demand for a good falls, prices must fall as well. Eventually some equilibrium will be reached.