Low and stable inflation
A)is important in order to have economic growth, since inflation and growth are positively correlated.
B)is important in order to have economic growth, since inflation and growth are negatively correlated.
C)is not important in order to have economic growth.
D)is important in order to have economic growth, since economic growth and inflation are not correlated.
E)is not important in order to have economic growth because there is a positive correlation between economic growth and inflation.

Question

Quizplus · Accepted Answer

Low and stable inflation is important to have economic growth, since inflation and growth are negatively correlated. When inflation is high and unstable, it creates uncertainty and instability in the economy, discouraging investment and reducing economic growth. Conversely, when inflation is low and stable, it creates a more stable environment for businesses to operate in, encouraging investment and promoting economic growth.

Low and Stable Inflation