Prices may sometimes adjust slowly to changes in market conditions as a result of

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Fixed-term contracts can delay the adjustment of prices to changes in market conditions as the terms of the contract set the price for a given period. This can lead to prices being higher or lower than the current market price, depending on the direction of the change in market conditions. Choices A, B, and E may also impact market prices, but they are not necessarily related to slow adjustment. Choice C, government regulations like price caps, would likely cause prices to adjust more quickly, as the market is restricted from setting prices freely.

Prices May Sometimes Adjust Slowly to Changes in Market Conditions