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Suppose Policy Makers Overestimate the Natural Rate of Unemployment

Question 37

Multiple Choice

Suppose policy makers overestimate the natural rate of unemployment.In situations like these,policy makers will likely implement policies that result in


A) less unemployment than necessary.
B) an unemployment rate that is "too low."
C) a lower inflation rate than necessary.
D) a steadily increasing inflation rate.
E) overly expansionary monetary and fiscal policy.

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