Which of the following statements is most likely true?
a. In the long term, low or moderate levels of inflation may not pose an overwhelming difficulty for business planning because costs of doing business and sales revenues may rise at similar rates.
b. In the short term, high levels of inflation may not pose an overwhelming difficulty for business planning because costs of doing business and sales revenues may rise at similar rates.
c. In the long term, high levels of inflation may not pose an overwhelming difficulty for business planning because costs of doing business and sales revenues may rise at similar rates.
d. In the short term, low or moderate levels of inflation may not pose an overwhelming difficulty for business planning because costs of doing business and sales revenues may rise at similar rates.
d. In the short term, low or moderate levels of inflation may not pose an overwhelming difficulty for business planning because costs of doing business and sales revenues may rise at similar rates.
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For a common resource, the marginal private cost of the resource is equal to the marginal social cost
Indicate whether the statement is true or false
The requirement that certain professionals possess a license in order to work in a particular market has the effect of reducing the supply of those services, which in turn causes:
A) price and the profits of firms in the market to increase. B) price and the profits of firms in the market to decrease. C) price to increase and the profits of firms in the market to decrease. D) price to decrease and the profits of firms in the market to increase.
Which of the following is true in regards to Okun's law?
A) employment does not increase commensurately with output rises because firms tend to hoard labor B) when demand increases, firms tend to work their employees harder and longer C) it is Okun's prediction of the negative relationship between the output and unemployment gaps that allows the modern Phillips curve to be translated into the AS curve D) all of the above E) none of the above
If a firm increases output when MR < MC, then:
a. profit will equal zero. b. profit will increase. c. profit will decrease. d. profit will remain the same. e. the firm is minimizing losses.