A vocal minority of economists, believers in the theory of rational expectations, insist that
A) the Phillips curve is downward sloping even in the short run.
B) the Phillips curve is vertical even in the short run.
C) a trade-off exists between inflation and unemployment even in the long run.
D) expansionary fiscal and monetary policy can reduce unemployment without creating inflation.
Correct Answer:
Verified
Q161: If employees and employers always accurately predict
Q162: Based on the evidence, most economists believe
Q163: If the self-correcting mechanism operates quickly,
A)direct intervention
Q164: Policymakers who believe that the costs of
Q165: Many economists think that, in the long
Q167: If actual inflation differs from expected inflation,
Q168: What will tend to happen to wages
Q169: If the short-run Phillips curve has a
Q170: If workers always see inflation coming, and
Q171: Rational expectations are forecasts
A)that, while not necessarily
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents