According to the Misperceptions Theory of Aggregate Supply,if a Firm

question 93

Multiple Choice

According to the misperceptions theory of aggregate supply,if a firm thought that inflation was going to be 5 percent and actual inflation was 6 percent,then the firm would believe that the relative price of what it produce had

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

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Definitions:

Compound

A material composed of multiple elements chemically combined in a specific proportion.

Soluble

The ability of a substance to dissolve in a solvent, forming a homogeneous solution.

Hydrocarbon Alkane

Saturated hydrocarbons consisting only of single bonds between carbon atoms, with a general formula of CnH2n+2.

Carbon Atoms

The core building blocks of organic molecules, consisting of six protons, six neutrons, and six electrons.