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Which of the following is the role of wages in the Classical Theory of Unemployment in the pursuit of full employment?

358744Medium DSSSB TGT Computer Science 0 replies 0 views
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Which of the following is the role of wages in the Classical Theory of Unemployment in the pursuit of full employment?
  • AWages are fixed and do not impact employment levels.
  • BWages are set by the government to maintain full employment.
  • CWages are flexible and adjust to achieve full employment.
  • DWages are irrelevant in determining employment levels.
Correct answer: C

Explanation

The Classical Theory of Unemployment assumes that wages are flexible and adjust up or down until the labour market reaches full employment.

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