If Firms Set Prices and Then Keep Them Fixed for a Period

question 245

Multiple Choice

If firms set prices and then keep them fixed for a period of time, their fixed prices imply that

• A) the aggregate price level is fixed and that aggregate demand determines the quantity of goods and services sold.
• B) prices are set by aggregate demand and supply.
• C) the aggregate price level adjusts continuously.
• D) the aggregate price level is fixed and that aggregate supply determines the quantity of goods and services sold.

---

Definitions:

Intimate Space

Describes the physical space closely surrounding a person, which they consider personal and is reserved for close friends, family, or romantic partners.

Burnout

A state of emotional, physical, and mental exhaustion caused by excessive and prolonged stress.

Sense of Accomplishment

The feeling of pride and satisfaction that comes from achieving something significant or completing a task.

Sales Quota

A set performance goal or target amount of sales that a salesperson or team is expected to achieve in a specified time frame.