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In the Short Run, If the Price Level Increases, Then

Question 2

Multiple Choice

In the short run, if the price level increases, then nominal wages


A) stay fixed and the firms' revenues and profits will increase.
B) stay fixed and the firms' revenues and profits also stay the same.
C) increase, causing the firms' revenues and profits to fall.
D) decrease, causing the firms' revenues and profits to rise.

Correct Answer:

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