When the General Price Level Rises and Firms Decide Not

question 55

Multiple Choice

When the general price level rises and firms decide not to change their prices in the short run,this can be attributed to

• A) menu costs.
• B) legally binding contracts.
• C) inflexible input prices.
• D) money illusion.
• E) a decline in revenues.

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Definitions:

General Adaptation Syndrome

A three-phase response (alarm, resistance, exhaustion) that describes the body’s physiological reaction to stress over time.

Stressful Demands

Situations or events that require significant mental or physical effort to deal with, often leading to stress.

General Adaptation Syndrome

A model describing the body's stress response in three stages: alarm, resistance, and exhaustion, proposed by Hans Selye.

Panic Attacks

Sudden periods of intense fear or discomfort, where four (or more) symptoms develop abruptly and peak rapidly.