According to the Misperceptions Theory of the Short-Run Aggregate Supply

question 9

Multiple Choice

According to the misperceptions theory of the short-run aggregate supply curve,if a firm thought that inflation was going to be 4 percent and actual inflation was 2 percent,then the firm would believe that the relative price of what it produces 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:

Self-Fulfilling Prophecy

An anticipation that, either directly or indirectly, ensures its own occurrence by fostering a loop between conduct and conviction.

Discrimination

Unjust or prejudicial treatment of different categories of people, often based on race, age, sex, or disability.

Jigsaw Classroom

An educational approach designed to minimize competition and promote cooperation among students by dividing assignments into interdependent parts.

Eliot Aronson

Eliot Aronson is a renowned American psychologist known for his work on the theory of cognitive dissonance and social psychology.