The Existence of Menu Costs Are Often Used to Explain

Multiple Choice

The existence of menu costs are often used to explain why:

A) the price of services, like those provided by restaurants and barbers, rise at a faster rate than the price of goods, like automobiles and clothing.
B) price and wage adjustments will be relatively rapid.
C) food prices tend to rise disproportionately rapidly in the consumer price index.
D) people prefer to look backward, instead of forward, when anticipating the future.
E) fiscal and monetary policies should be relatively effective.