Inflation may impose little, if any, cost on the economy, if ________
A) laws against excessive price increases are enforced effectively
B) the government subsidizes menu costs
C) price increases are fully anticipated
D) the Fisher effect holds true
E) the rate of price increase is so slow that people do not feel compelled to alter their behavior
E
You might also like to view...
The velocity of circulation is equal to
A) the price level multiplied by the quantity of money. B) nominal GDP divided by the quantity of money. C) the quantity of money divided by the price level and then multiplied by real GDP. D) the quantity of money divided by nominal GDP. E) the price level divided by real GDP.
A characteristic common to most imperfectly competitive markets is
A) a homogeneous product. B) unexploited economies of scale. C) non-price competition among firms. D) inelastic market demand curves. E) common pricing among firms.