The Small-Menu Cost Theory States That

question 20

Multiple Choice

The small-menu cost theory states that

• A)prices are not fully flexible because it is costly for firms to change prices every time there is a demand change.
• B)economic agents quickly learn the likely responses of the Bank of Canada to changes in unemployment.
• C)wages depend on the productivity of workers.
• D)the economy is characterized by perfect competition.

---

Definitions:

Employee Retention

The ability of an organization to retain its employees and reduce turnover by creating a positive working environment and offering incentives.

Gain

An increase in wealth, resources, or advantages, often realized through investment, business operations, or other economic activities.

Existing Partners

Current collaborative entities or individuals that are engaged in a business agreement or relationship with one another.

Key Managers

Critical individuals within an organization responsible for making important decisions and driving its success.