John Maynard Keynes believed that wages may be inflexible in the downward direction. Consequently, an economy:
a. Could get stuck in long-run equilibrium.
b. Could get stuck in a recessionary gap.
c. Could get stuck in an inflationary gap.
d. Would always produce more than Natural Real GDP.
e. b and c
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Home » Business » John Maynard Keynes believed that wages may be inflexible in the downward direction. Consequently, an economy: a. Could get stuck in long-run equilibrium. b. Could get stuck in a recessionary gap. c. Could get stuck in an inflationary gap. d.