In the summer of 1999, the FOMC became concerned that ____
A) robust economic growth would trigger higher inflation.
B) robust economic growth would trigger deflation.
C) weak economic growth would trigger higher inflation.
D) weak economic growth would trigger deflation.
E) interest rates were volatile.

Question

Quizplus · Accepted Answer

The FOMC became concerned that robust economic growth would trigger higher inflation. This is because when the economy is growing rapidly, there is typically an increase in demand for goods and services, which can lead to rising prices. The FOMC's main goal is to maintain price stability, so they would be worried about inflationary pressures.

In the Summer of 1999, the FOMC Became Concerned That