In the Long Run, Attempts to Expand Beyond an Economy's

question 93

Multiple Choice

In the long run, attempts to expand beyond an economy's natural rate of unemployment tend to result in

• A) increased inflation.
• B) increased output.
• C) both increased output and increased inflation.
• D) neither increased output nor increased inflation.

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Definitions:

5-Year Loan

A type of loan that is scheduled to be repaid through payments over a period of five years.

Expected Inflation Rate

The anticipated rate at which the general level of prices for goods and services will rise over a period, affecting purchasing power.

Consumption Sector

A segment of the economy focused on the purchasing and use of goods and services by individuals and households.

Production Sector

The segment of the economy concerned with the production of goods and services, including agriculture, manufacturing, and construction.