Which of the Following Statements Concerning Price Rigidity Is TRUE

question 228

Multiple Choice

Which of the following statements concerning price rigidity is TRUE?

• A) Since the economy experiences continued inflation prices are not rigid.
• B) Prices will be rigid when there is unanticipated monetary policy but not when there is anticipated monetary policy.
• C) Data has clearly demonstrated that the long run aggregate supply curve is horizontal.
• D) When there are demand changes, firms will not change their price because of the costs associated with renegotiating contracts and informing customers of price changes.

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