In: Economics
Explain what economists mean by “menu costs.” (select all that apply)
A. |
Menu costs are the costs to seller of changing their product line |
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B. |
Menu costs are the costs to seller of rapidly changing their prices. |
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C. |
Menu costs are the costs to the employer of buying dinner for the company party |
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D. |
Menu costs are the profit benefits to suppliers of rapidly changing their prices. |
The correct option is:
B. |
Menu costs are the costs to seller of rapidly changing their prices. |
Menu costs are the costs that come with changing prices. The implied example is the cost of a restaurant having to reprint all its menus.