The inflation adjustment line is used to
A)describe how the government adjusts fiscal policy to influence prices and wages in the economy.
B)describe the Fed's target inflation rate.
C)describe how the Fed adjusts interest rates to control inflation.
D)describe how firms and workers act to set prices and wages in the economy.
E)explain the instability of price adjustments.

Question

Quizplus · Accepted Answer

The inflation adjustment line describes how firms and workers set prices and wages, reflecting their expectations of inflation and economic conditions.

The Inflation Adjustment Line Is Used to