According to the menu cost theory, firms will be slow in changing their prices because

A) if prices changed frequently, individuals would reduce their demand for that good because of uncertainty.
B) frequent price changes would be a sign of monopolistic behavior.
C) the cost of changing the price might exceed the additional revenue the price change would generate.
D) demand for their product would fall because consumers would purchase goods from firms that had not raised their prices.

C

Economics

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________ can counteract a currency depreciation

A) Autonomous monetary policy tightening B) Purchase of international reserves C) Autonomous monetary policy easing D) Capital controls

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At the end of the future period, in the real intertemporal model with investment

A) the firm's capital becomes useless and is thrown away. B) the firm's capital is used to produce more capital for the distant future. C) the firm can convert capital one-for-one into consumption goods. D) the firm's capital is converted into labor.

Economics