Economists Argue That Central Banks That Are Credible in Their

question 63

Multiple Choice

Economists argue that central banks that are credible in their fight against inflation can more easily:

• A) lower inflation without creating extra unemployment.
• B) lead the economy into a depression.
• C) buy bonds.
• D) increase the money supply.

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Definitions:

Chernobyl

The site of a catastrophic nuclear disaster that occurred on April 26, 1986, in the Soviet Union, now within Ukraine, resulting in severe radioactive contamination.

Nuclear Reactor

A device used to initiate and control a self-sustained nuclear chain reaction, primarily for the generation of electricity.

German Federal Republic

Known as West Germany, a country that existed from 1949 to 1990, created during the post-World War II period and later reunified with East Germany.

Détente

A period of improved relations between the United States and the Soviet Union in the 1970s, marked by the signing of treaties and efforts to reduce tension during the Cold War.