The Price-Adjustment Mechanism's Relevance to the Real World Has Been

question 18

True/False

The price-adjustment mechanism's relevance to the real world has been questioned on the grounds that national output is generally not at the full-employment level and that the velocity of money is not always constant.

---

Definitions:

Short Run

A period in which at least one input is fixed while others may be varied to adjust output levels.

Long Run

The long run is a period in economics where all factors of production and costs are variable, allowing companies to adjust all inputs.

TVC

Total Variable Cost, which refers to the total of all costs that vary with the level of output in the production of goods or services.

Short Run

In economics, a period in which at least one factor of production is fixed and cannot be changed.