In the Short-Run, an Increase in the Average Price Level

Multiple Choice

In the short-run, an increase in the average price level will cause:

A) demand for the good to increase but total production to decline.
B) profits to rise and, thus, total production to increase.
C) interest rates to fall and thus total production to decline.
D) input costs to fall and, thus, total production to rise.
E) input costs to fall and, thus, total production to decline.