Economics 9708 · AS & A Level · Market failure

Market failure — practice question

The diagram illustrates the link between the rate at which wages rise and the unemployment rate. Which change would be expected to make the curve in the diagram move downwards and to the left?

  • Aa reduction in regional differences in unemployment rates
  • Ban increase in the proportion of the workforce belonging to trade unions
  • Can increase in the unemployment rate
  • Dthe expectation of a higher rate of inflation

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