The Misperceptions Theory of the Short-Run Aggregate Supply Curve Says

question 26

Multiple Choice

The misperceptions theory of the short-run aggregate supply curve says that if the price level is higher than people expected,then some firms believe that the relative price of what they produce has

• A)decreased,so they increase production.
• B)decreased,so they decrease production.
• C)increased,so they increase production.
• D)increased,so they decrease production.

---

Definitions:

Voting Shares

Voting shares are shares of a company's stock that grant the shareholder the right to vote on the company's matters, typically in influencing the election of the board of directors.

Aggressors

Aggressors are individuals or entities that initiate hostility or conflict, often without provocation.

Institutional Investors

Organizations that invest large sums of money into securities, real estate, and other investment assets.

Shares

Units of ownership interest in a corporation or financial asset, which provide for an equal distribution in any profits, if any are declared, in the form of dividends.