Most economists today believe that the appropriate monetary and/or fiscal policy can permanently reduce the unemployment rate below the natural rate.

Question

Quizplus · Accepted Answer

Most economists believe in the concept of the natural rate of unemployment, which is the lowest rate of unemployment that can be sustained without causing inflation. It is believed that policies can temporarily reduce the unemployment rate below the natural rate, but in the long run, it will return to the natural rate. Therefore, it is not believed that policies can permanently reduce the unemployment rate below the natural rate.

Most Economists Today Believe That the Appropriate Monetary And/or Fiscal