Some economists suggest that because of the costs of negotiating contracts, printing price lists, etc., it is costly for firms to change prices in response to demand changes. This hypothesis is known as the

Question

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The hypothesis described in the question is known as the menu cost theory. It suggests that because firms face costs in changing their prices, they may delay price adjustments even when there is a change in demand or production costs. This can lead to price stickiness in the short run. The other options (A, C, D) are unrelated theories and do not address the specific hypothesis described in the question.

Some Economists Suggest That Because of the Costs of Negotiating