According to the Menu Cost Theory,firms Will Be Slow in Changing

question 5

Multiple Choice

According to the menu cost theory,firms will be slow in changing their prices because

• A)if prices changed frequently, individuals would reduce their demand for that good because of uncertainty.
• B)frequent price changes would be a sign of monopolistic behavior.
• C)the cost of changing the price might exceed the additional revenue the price change would generate.
• D)demand for their product would fall because consumers would purchase goods from firms that had not raised their prices.

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Definitions:

Iteration

The repetition of a process or set of instructions in programming, typically implemented with loops, to systematically approach a desired outcome.

Sequence Structure

A set of code statements executed in order, one after the other, often used to describe the basic flow of a program.

Selection

The process of choosing between two or more paths in programming based on conditions, often implemented with if-else and switch statements.

Iteration

The process of repeating a set of instructions or steps a specific number of times or until a certain condition is met in programming.