Prices not always flexible in the short run from "summary" of The General Theory of Employment, Interest, and Money by John Maynard Keynes
In the short run, businesses may not always have the flexibility to adjust their prices in response to changes in demand. This lack of flexibility can lead to imbalances in the economy, resulting in fluctuations in output and employment levels. When demand for a good or service suddenly drops, businesses may find themselves with excess inventory that they are unable to sell at the current price. In this situation, firms may be reluctant to lower prices in order to clear out their inventory, as doing so could lead to lower revenue and potentially lower profits. Similarly, if ...
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