According to Figure 7.1 in Country A,
A)Relative prices may have been changing,but average prices were constant.
B)Relative prices were definitely constant.
C)Average prices and relative prices were definitely changing.
D)Average prices were constant,and unemployment was increasing.

Question

According to Figure 7.1 in Country A,
A)Relative prices may have been changing,but average prices were constant. 
B)Relative prices were definitely constant. 
C)Average prices and relative prices were definitely changing. 
D)Average prices were constant,and unemployment was increasing.

Quizplus · Accepted Answer

Figure 7.1 shows that the average prices remained constant but the relative prices could have been changing. Hence, option A is the correct choice. Option B is incorrect because the figure does not provide evidence for constant relative prices. Option C is also incorrect because it implies that both average and relative prices were changing. Option D is incorrect because the figure does not provide any information about unemployment.