Can macroeconomic policy be used systematically to create unanticipated inflation?
A)Yes, according to Keynesian economists.
B)Yes, according to classical economists.
C)No, according to Keynesian economists.
D)Yes, according to classical economists, if Ricardian equivalence holds.

Question

Quizplus · Accepted Answer

Keynesian economists believe that macroeconomic policy, such as fiscal and monetary policy, can be used to influence economic conditions, including creating unanticipated inflation. This is because they argue that in the short run, prices and wages are sticky, allowing government policies to have real effects on output and employment, which can lead to unanticipated inflation if the policies are not fully anticipated by the public.

Can Macroeconomic Policy Be Used Systematically to Create Unanticipated Inflation