A high-pressure economy is one in which
A)monetary and fiscal policy are used to keep unemployment as low as possible.
B)there is no unemployment insurance,putting pressure on workers to keep their jobs and stay off welfare.
C)wage and price controls prevent firms from raising prices by more than the general price level.
D)the Central Bank tightens monetary policy to force all inflation out of the economy.

Question

Quizplus · Accepted Answer

A high-pressure economy is characterized by low unemployment rates, which is achieved through the use of both monetary and fiscal policies to stimulate demand and spur job creation. The goal is to create an environment in which businesses are hiring and workers have bargaining power, resulting in higher wages and more economic growth. Therefore, choice A is the best answer. B, C, and D are not accurate descriptions of a high-pressure economy.

A High-Pressure Economy Is One in Which