Asked by
Deborah Jaeger
on Dec 17, 2024
Verified
If a central bank attempts to lower the inflation rate but the public doesn't believe the inflation rate will fall as far as the central bank says, then in the short run unemployment
A) rises.As inflation expectations adjust, the short-run Phillips curve shifts right.
B) rises.As inflation expectations adjust, the short-run Phillips curve shifts left.
C) falls.As inflation expectations adjust, the short-run Phillips curve shifts right.
D) falls.As inflation expectations adjust, the short-run Phillips curve shifts left.
Central Bank
An institution that manages a country's currency, money supply, and interest rates, overseeing the commercial banking system.
Inflation Rate
The rise in the average price levels of goods and services within an economy over a given time frame.
Unemployment
The situation when individuals who are able and willing to work at current wage rates cannot find employment.
- Understand the impact of anticipations on determining the results of unemployment and inflation indicators.
- Examine how alterations in the money supply and anticipations of inflation impact economic conditions.
Verified Answer
PR
Learning Objectives
- Understand the impact of anticipations on determining the results of unemployment and inflation indicators.
- Examine how alterations in the money supply and anticipations of inflation impact economic conditions.
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