The difficulty in cost-benefit analysis is that the benefits are usually evident and easily measurable, while the costs are not
1 answer:
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Answer:
c. fall in the short run, and fall even more in the long run.
Explanation:
The aggregate demand shifts to the left in recession or contractions, in consequence the level of prices falls. For this analysis we consider the shor-run supply curve with a positive slop.
As we know, the economy in the long run tends to equilibrium, where the the production level is fixed and equal to the potential of production of the economy. The initial reduction of prices incentives the consumption in the long run, stabilizing with the long run quantites in a minor level of prices.
In the attached image you can observe the process described previously.
