The short run in macroeconomic analysis is a period
A) in which wages and some other prices do not respond to changes in economic conditions.
B) in which full wage and price flexibility and market adjustment have been achieved.
C) of less than 12 months.
D) in which all macroeconomic variables are fixed.

Question

Quizplus · Accepted Answer

The short run is a period in which wages and some other prices do not respond immediately to changes in economic conditions. This is due to factors such as contracts and other agreements that set prices in the short run. While some prices may adjust quickly, others take time to change, leading to a lagged response in the short run. The length of the short run can vary but is typically thought of as a period of less than a year.

The Short Run in Macroeconomic Analysis Is a Period