The cost effect implies that
A)Higher costs are reflected in higher average prices.
B)The aggregate supply curve is linear.
C)Lower average prices result in greater quantity supplied.
D)The aggregate demand curve is downward-sloping.

Question

Quizplus · Accepted Answer

The cost effect implies that higher costs for producing goods and services are typically passed on to consumers in the form of higher average prices, reflecting the relationship between production costs and pricing.

The Cost Effect Implies That