According to the misperceptions theory of short-run aggregate supply, if a firm thought that inflation was going to be 5 percent and actual inflation was 6 percent, then the firm would believe that the relative price of what it produce had Select one: a. increased, so it would increase production. O b. increased, so it would decrease production. O c. decreased, so it would increase production. O d. decreased, so it would decrease production.

According to the misperceptions theory of short-run aggregate supply, if a firm thought that inflation was going to be 5 percent and actual inflation was 6 percent, then the firm would believe that the relative price of what it produce had Select one: a. increased, so it would increase production. O b. increased, so it would decrease production. O c. decreased, so it would increase production. O d. decreased, so it would decrease production.

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter33: Aggregate Demand And Aggregate Supply

Section: Chapter Questions

Problem 4CQQ

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