Which of the following best explains how an economy could simultaneously experience high inflation and high unemployment?
A) The government increases spending without increasing taxes
B) The government increase taxes without increasing spending
C) Inflationary expectations decline
D) Women and teenagers stay out of the labor force
E) Negative supply shocks cause factor prices to increase
Answer: E) Negative supply shocks cause factor prices to increase
You might also like to view...
Managed float exchange systems were abandoned with the implementation of the gold standard
Indicate whether the statement is true or false
Economists use a preference map to illustrate that
A) more is better than less. B) preferences are transitive. C) preferences are complete. D) All of the above.
Products produced in oligopoly markets can be homogeneous.
Answer the following statement true (T) or false (F)
“The benefits of unimpeded immigration exceed the costs.” Do you agree?
What will be an ideal response?