Multiple Choice
If the economy is in long run equilibrium at full employment, the level of overall economic activity is not affected by changes in the price level due to:
A) the fact that firms' profits increase with the price level.
B) the existence of sticky prices.
C) the fact that prices and input costs change simultaneously and in the same direction.
D) the fact that prices increase more slowly than input costs.
Correct Answer:

Verified
Correct Answer:
Verified
Q163: <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB5231/.jpg" alt=" Figure 9.1 -Refer
Q164: If the marginal propensity to consume is
Q165: Many economists have argued that oil prices
Q166: <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB5231/.jpg" alt=" Figure 9.4 -Refer
Q167: Recall Application 2, "Two Approaches to Determining
Q169: Recall Application 3, "How the U.S. Economy
Q170: Recall Application 3, "How the U.S. Economy
Q171: The multiplier is always larger than one.
Q172: Custom prices are also known as:<br>A) flexible
Q173: Because the long run aggregate supply curve