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Fluctuation in the target interest rate in the New Keynesian model lead to all of the following except A. procyclical real wages. B. procyclical employment.

  1. Fluctuation in the target interest rate in the New Keynesian model lead to all of the following except

    A.

    procyclical real wages.

    B.
    procyclical employment.
    C.

    countercylical prices.

    D.
    procyclical consumption.

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ANSWER A procyclical real wages Real wages are very procyclical in response to technology shocks and ... blur-text-image

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