In the long run, an increase in the quantity of money leads to
A) a smaller percentage increase in the real interest rate.
B) a smaller percentage increase in the price level.
C) an equal percentage increase in the price level.
D) no effect on the price level or on real GDP.
E) an equal percentage increase in the real interest rate.
C
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A firm in monopolistic competition ________ influence its price and ________ influence the market average price
A) can; can B) can; cannot C) cannot; can D) cannot; cannot E) can; only in the short run can
Please use the following statements to answer this question:
I. The process of testing and revising theories is central to the development of economics as a science. II. Theory is imperfect and may not adequately describe economic behavior in some cases. A) I and II are true. B) I is true and II is false. C) I is false and II is true. D) I and II are false.