In what way do policy makers have to face a trade-off between inflation and unemployment?
a. The cost of reducing inflation by restrictive fiscal and monetary policies is a temporary increase in unemployment.
b. The cost of reducing inflation by restrictive fiscal and monetary policies is a permanent increase in unemployment.
c. The cost of reducing unemployment by expansionary fiscal and monetary policies is virtually nonexistent.
d. The cost of reducing unemployment by expansionary fiscal and monetary policies involves higher inflation during recessions.
a
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In the Keynesian model, whenever planned saving exceeds planned investment
A) the interest rate will remain unchanged. B) there will be unplanned inventory depletion. C) real GDP will not be influenced. D) there will be unplanned inventory accumulation.
Looking at the _________ approach to GDP accounting, the largest component of GDP in 2003was _______
a. expenditure; government purchases b. national; proprietor's income c. national income; net interest d. expenditure; personal consumption expenditures e. expenditure; compensation of employees