When the Actual Change in the Price Level Differs from Its

Multiple Choice

When the actual change in the price level differs from its expected change,which of the following can explain why firms might change their production?

A) both menu costs and mistaking a price level change for a change in relative prices
B) menu costs but not mistaking a price level change for a change in relative prices
C) mistaking a price level change for a change in relative price but not menu costs
D) neither menu costs nor mistaking a price level change for a change in relative prices