Suppose that product prices start rising but nominal wages


Suppose that product prices start rising but nominal wages do not. In that case,

real wages will fall and firms will want to produce more because doing so will be profitable.

real wages will rise and firms will want to produce more because doing so will be profitable.

there will be a surplus of goods and services produced.

there will be a shortage of goods and services produced.

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Business Economics: Suppose that product prices start rising but nominal wages
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