What would a policy designed to permanently reduce unemployment below its natural rate require?
A)a one-time increase in the price level
B)an ongoing increase in inflation rates over time
C)a permanent decrease in taxes
D)a one-time increase in aggregate demand

Question

Quizplus · Accepted Answer

A policy designed to permanently reduce unemployment below its natural rate would require an ongoing increase in inflation rates over time, as suggested by the Phillips Curve, which indicates a trade-off between inflation and unemployment.

What Would a Policy Designed to Permanently Reduce Unemployment Below