To bring inflation under control, which combination of unemployment and growth may be necessary?
A) high unemployment, high growth
B) high unemployment, low growth
C) low unemployment, high growth
D) low unemployment, moderate growth

Question

Quizplus · Accepted Answer

To bring inflation under control, it is necessary to have a lower rate of economic growth, as this helps to slow down demand and hence the increase in prices. This will usually result in temporary higher unemployment until the inflation rate falls back to a lower level. Therefore, high unemployment and low growth are necessary to bring inflation under control in the short term.

To Bring Inflation Under Control, Which Combination of Unemployment and Growth