If the Federal Reserve Attempts to Continue Reducing Unemployment by Manipulating

question 5

Multiple Choice

If the Federal Reserve attempts to continue reducing unemployment by manipulating monetary policy,which of the following would you expect to see?

• A)The Fed will follow deflationary monetary policies.
• B)The Fed will follow inflationary monetary policies.
• C)The rate of inflation will fall as Fed tries to reduce the unemployment rate.
• D)The Fed will reduce the natural rate of unemployment.

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