Prices and wages tend to be

Question

Multiple Choice
flexible both upward and downward.
inflexible both upward and downward.
flexible downward but inflexible upward.
flexible upward but inflexible downward.

Answer 1

The correct answer is: flexible upward but inflexible downward.

This reflects the common understanding in economics that while prices and wages can increase in response to demand or other factors, they tend to be more resistant to decreases, often due to factors such as worker morale, contracts, and perceived value.