A. firms are worried that frequent price changes would annoy consumers. B. most firms have agreements with each other to fix prices at profit-maximizing levels. C. government controls most prices. D. foreign competition discourages domestic firms
from price changes.
A. Government regulations limit the number of times a firm can change prices in a year.
B. In most industries the profit-maximizing price does not change even when demand
changes.
C. Production costs do not tend to change when a firm varies its level of output.
D. Firms may be reluctant to change prices for fear of setting off a price war or losing
customers to rivals.
Answer: D
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