Proponents of zero-inflation policies acknowledge that the public is unconcerned about the inflation rate

Consider a perfectly competitive market experiencing good times. In the short run, the equilibrium price will ________ and firms will earn a(n) ________

A) increase; economic profit as the new price exceeds average total cost B) increase; normal profit as the new price exceeds average total cost C) decrease; economic loss as new firms enter the industry D) decrease; economic profit as firms exit the industry E) may increase or decrease; normal profit depending on their costs

The Phillips curve assumes that shocks to the economy come from the demand side

a. True b. False Indicate whether the statement is true or false