Most economists think changes in which type of unemployment affects inflation?
A) frictional unemployment
B) cyclical unemployment
C) structural unemployment
D) natural rate of unemployment

Question

Quizplus · Accepted Answer

Cyclical unemployment, which is caused by economic downturns and recessions, affects inflation because it reduces the demand for goods and services, which in turn can lead to lower prices. As a result, policymakers may need to implement expansionary monetary or fiscal policies to boost aggregate demand and keep inflation from falling too low.

Most Economists Think Changes in Which Type of Unemployment Affects