The costs associated with recalculating prices and printing new price lists when there is inflation are known as:
A. shoe leather costs.
B. menu costs.
C. chain-index costs.
D. diminishing costs.
Answer: B
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According to your authors, market clearing
A) is planned by all buyers. B) is planned by all sellers. C) is planned by all buyers and sellers. D) is planned by economists and government agencies. E) is an unintended consequence of people pursuing their own plans.
In practice, money growth targeting was
A) a good idea. B) a policy introduced in the U.S. in the 1970s, which continues to the present. C) better than interest rate targeting. D) a failure.
Which of the following will lead to a decrease in aggregate demand in the United States?
a. a higher price level b. a decrease in the real interest rate c. rapid growth in real income in Japan and Western Europe d. an increase in the exchange rate value of the dollar
We cannot predict the effect on the equilibrium quantity, but know that the market clearing price will decrease when
A) supply increases and demand increases. B) supply decreases and demand decreases. C) supply decreases and at the same time demand increases. D) supply increases and at the same time demand decreases.