All the Following Explain Price Stickiness Except

question 11

Multiple Choice

All the following explain price stickiness except

• A)firms choose not to adjust prices until they can assess if changes in sales are temporary or permanent.
• B)the more firms produce, the lower the average cost of production.Therefore, firms are willing not raise prices as long as they can sell more.
• C)firms may be concerned that consumers may be angered by price increases.
• D)firms may be concerned that their rivals may not match their price increases.

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Definitions:

Marginal-cost Schedule

A table or graph showing how the cost of producing one more unit of a good or service varies as the production level changes.

Fixed Costs

Overheads that are unaffected by changes in production or sales quantities, encompassing rent, employee salaries, and insurance payments.

Average Total Cost Curves

Average Total Cost Curves represent the total cost per unit of output, calculated by dividing the total cost by the quantity of output produced.

Plant Size

Refers to the scale of operations or production capacity of a manufacturing facility or factory.