Because Some Resource Prices Are Assumed to Be Constant in the Short

question 189

Multiple Choice

Because some resource prices are assumed to be constant in the short run,

• A)the aggregate supply curve is horizontal in the short run
• B)the aggregate supply curve is vertical in the short run
• C)costs do not increase as much as output prices do when the price level rises
• D)an increase in price per unit is the same thing as a decrease in profit per unit
• E)firms' total costs of production decrease as output increases