What did Milton Friedman and E.S. Phelps argue with respect to the Phillips Curve?
A. The Phillips Curve could accurately guide activist policy makers over the long run.
B. The inflation rate will consistently be 2 percentage points below the unemployment rate.
C. The inverse relationship between unemployment and inflation only holds in the long run. In the short run, unemployment and inflation are positively related.
D. Economic participants would soon understand activist policymakers' strategy and revise their expectations, making discretionary efforts to fine-tune the economy ineffective.
Answer: D
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Which of the following is NOT a determinant of demand?
A) consumers' incomes B) prices of other goods C) consumers' tastes D) production technology
If aggregate demand shifts left, then in the short run
a. the price level and real GDP both rise. b. the price level rises and real GDP falls. c. the price level falls and real GDP rises. d. the price and real GDP both fall.
Bob's Barber Shop cut 3,000 heads of hair in 2014 and 3,100 in 2015. The price of a haircut was $7 in 2014 and $8 in 2015. If 2014 is the base year, what was Bob's contribution to nominal GDP in the year 2014?
A. $24,000 B. $21,700 C. $24,800 D. $21,000
It is common for fashion trends to follow celebrity fashion choices. This is an example of:
A. inferring quality from price. B. bounded rationality. C. conspicuous consumption. D. focal point equilibrium.