Which of the Following Could Decrease Unemployment and Inflation Simultaneously

question 206

Multiple Choice

Which of the following could decrease unemployment and inflation simultaneously?

• A)a decrease in oil prices
• B)expansionary monetary policy
• C)contractionary monetary policy
• D)an increase in the real wage

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Definitions:

Availability Heuristic

A mental shortcut used when judging the frequency or probability of events based on how easily examples come to mind.

Cognitive Heuristic

A mental shortcut that allows people to solve problems and make judgments quickly and efficiently.

Simulation

A method for implementing a model over time to study the behavior of a system or to analyze the implications of a complex process or strategy.

System-1 Thinking

Reactive thinking that relies heavily on situational cues, salient memories, and heuristic thinking to arrive quickly and confidently at judgments.