Which of the Following Best Characterizes Prices in the Long

question 89

Multiple Choice

Which of the following best characterizes prices in the long run, but NOT in the short run?  

• A) All prices are flexible. 
• B) Prices are NOT flexible. 
• C) Some resource prices are fixed. 
• D) Only input prices are flexible.

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Definitions:

Net Domestic Product

A measure of a nation's total economic output, adjusted for depreciation; it is the gross domestic product (GDP) minus the depreciation on a country’s capital goods.

National Income

The total amount of money earned within a country from the production of goods and services over a specified period, usually a year.

GDP Deflator

An economic metric that converts output measured at current prices into constant-dollar GDP, stripping out the effects of inflation.

GDP

Gross Domestic Product, a measure of the total economic output of a country within a specific time period.