When prices and unemployment rise, such an event is sometimes called
a) expansion.
b) stagflation.
c) inflation.
d) depreciation.
Ans: b) stagflation.
You might also like to view...
Which of the following is a factor determining the natural rate of unemployment?
A. real GDP B. the business cycle C. demographics D. the labor force participation rate
Demand deposits $300 million Time deposits: Original maturity (less than 18 months): $200 million Original maturity (over 18 months): $400 million Use the information above to find the bank's required reserves.
What will be an ideal response?
According to the monetarist point of view
A. to avoid inflation, the Federal Reserve should create reserves at the same rate as the velocity of money. B. velocity of money is not constant; therefore, the increase in the money supply should not be constant. C. in the short run, increased unemployment and/or reduced inflation are the result of a reduction in the growth of the money supply. D. in the short run, changes in the money supply can have no effect on output in the economy, only on prices.
Over the last four decades, our unemployment rate has generally been between
A. 2-6 percent. B. 4-8 percent. C. 6-10 percent. D. 10-14 percent. E. 14-18 percent.