In the complete model, the price level is predetermined because
A) consumers usually cannot negotiate prices with retail outlets.
B) in a competitive market environment firms must take prices as given.
C) no one consumer is large enough to influence price.
D) it depends on previous firm and consumer behavior.
E) none of the above.

Question

Quizplus · Accepted Answer

In the complete model, the price level is considered predetermined because it is influenced by past decisions and behaviors of firms and consumers, rather than being instantly adjustable to current market conditions. This reflects the idea that prices are sticky and do not adjust immediately to new economic information or changes in supply and demand.

In the Complete Model, the Price Level Is Predetermined Because