The "key ingredient" in ending a hyperinflation is to
A) allow the money supply to grow more rapidly.
B) reduce the enormous budget deficit.
C) require wage contracts to be indexed more frequently.
D) devalue the nation's currency in the foreign exchange market.
B
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If the Federal Reserve wants to reduce inflation from 4 percent to 3 percent permanently, how can that goal be achieved, and what impact will that have on employment in the short run and the long run? Support your answer with a graph of the Phillips
curve in the short run and the long run.
A movement downward toward the right along a typical production possibilities curve represents
a. decreasing production of both goods under consideration. b. increasing production of both goods under consideration. c. increasing production of one good and decreasing production of the other. d. increasing production of one good with no change in production of the other.
If an economy uses monetary policy as its stabilization tool, the real interest rate and thus ________-run economic welfare depend on that economy's ________ policy
A) short, monetary B) short, fiscal C) long, monetary D) long, fiscal
In terms of the musical chairs analogy in the text, which of the following is a description of structural unemployment?
A. There are too many chairs. B. There are enough chairs, but it takes time to find one. C. There are too few chairs. D. There are enough chairs, but some are not the right size.