When the General Price Level Rises and Firms Decide Not

question 55

Multiple Choice

When the general price level rises and firms decide not to change their prices in the short run,this can be attributed to

• A) menu costs.
• B) legally binding contracts.
• C) inflexible input prices.
• D) money illusion.
• E) a decline in revenues.

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Definitions:

Transverse

Positioned or extending across something, typically right angles to something else, or lying across the body or a body part.

Superior

An anatomical term indicating a structure situated above or directed upward, often in relation to another body part.

Cephalic

Relating to, or located on or near the head.

Dorsal

Pertaining to the back or posterior of an organism, opposite of ventral.