The fact that severe fluctuations in inflation and unemployment are socially undesirable helps make the case for
a. a "hands off" policy by the government.
b. fixed prices and wages.
c. active government stabilization policy.
d. restrictions on imports from low wage countries.
c
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Which of the following shifts the short-run but not the long-run aggregate-supply curve left?
a. an increase in the expected price level b. a decrease in the expected price level c. a decrease in how much people want to consume d. an appreciation of the dollar
Suppose an economy experiences a permanent increase in its natural unemployment rate. This change leads to
A) a downward movement along the short-run Phillips curve. B) a leftward shift of the short-run Phillips curve. C) a rightward shift of the short-run Phillips curve. D) an upward movement along the short-run Phillips curve. E) no change in the short-run Phillips curve.