In the Long Run,inflation

question 11

Multiple Choice

In the long run,inflation

• A)and unemployment are primarily determined by labor market factors.
• B)and unemployment are primarily determined by the rate of money supply growth.
• C)is primarily determined by the rate of money supply growth while unemployment is primarily determined by labor market factors.
• D)is primarily determined by labor market factors while unemployment is primarily determined by the rate of money supply growth.

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Definitions:

Monopolistically Competitive

In a monopolistically competitive market, many firms sell products that are similar but not identical, allowing for product differentiation and some degree of market power over prices.

Short Run

A period in economic analysis in which at least one input is fixed while others are variable.

Long Run

the period in which all factors of production and costs are variable, allowing for all possible adjustments, including the adoption of new technology.

Short-run Equilibrium

A condition in which demand and supply are equal in a particular market or industry, but only for a temporary period due to fixed factors in the short term.