Consider the three theories of the upward slope of the short-run aggregate-supply curve. According to the sticky-wage theory, the economy is in a recession because the price level has declined so that real wages are too . True or False: According to the sticky-price theory, the economy is in a recession because people expect prices to rise quickly in a recession. True False According to the misperceptions theory, the economy is in a recession when the price level is what was expected.

According to the sticky-wage theory, the economy is in a recession because the price level has declined so that real wages are too

⇒HIGH. According to this theory, the increase of real wages will result in lower production levels and lower employment.

According to the sticky-price theory, the economy is in a recession because people expect prices to rise quickly in a recession.

⇒TRUE. The sticky price theory is based on the concept that prices will not change quickly enough to adjust to a new optimal equilibrium level.

According to the misperceptions theory, the economy is in a recession when the price level is what was expected.

⇒FALSE. According to this theory if the price level decreases, suppliers will reduce output levels resulting in a recession.

since the options are not listed, when you are working on your budget you should also add water, tv, internet, miscellaneous and your 'fun' money for in your budget. when budgeting, you need to allow for fun money, and mis/accidental money so that you stick to the budget and not go crazy because you feel strapped to the budget.