Discover the best answers at Westonci.ca, where experts share their insights and knowledge with you. Explore thousands of questions and answers from a knowledgeable community of experts on our user-friendly platform. Discover detailed answers to your questions from a wide network of experts on our comprehensive Q&A platform.

Milovia is a small open economy. The general price level in the economy has been increasing at a rate of about 7. 5 percent each year. Jane​ wilson, an industry​ analyst, is of the opinion that such high inflation is adversely affecting aggregate demand in the economy and therefore its ability to grow. Her​ colleague, harry​ gomes, however, disagrees. According to​ harry, some amount of inflation is unavoidable in a growing economy. Higher prices for products help to increase the level of corporate profits and induce firms to increase aggregate output. Which of the​ following, if​ true, will indicate that higher prices will not induce firms to increase​ output?.