The short-run version of aggregate supply assumes that
A)product prices are fixed, while resource prices are flexible.
B)product prices are flexible, while resource prices are fixed.
C)both input and product prices are flexible.
D)both input and product prices are fixed.

Question

Quizplus · Accepted Answer

In the short-run aggregate supply, product prices are flexible, allowing firms to adjust prices based on demand, while resource prices (like wages) are often fixed due to contracts and other rigidities.

The Short-Run Version of Aggregate Supply Assumes That