In New Keynesian analysis,firms are assumed to be
A)interested solely in maximizing their profit.
B)interested in both their profit and the avoidance of business cycles.
C)interested solely in avoiding business cycles.
D)interested solely in maximizing production.

Question

Quizplus · Accepted Answer

In New Keynesian analysis, firms are assumed to be interested solely in maximizing their profit. This assumption is often made in microeconomic theory, as it is rational for a business to seek to maximize its profits in order to stay competitive and achieve financial success.

In New Keynesian Analysis,firms Are Assumed to Be