An Inflation Dove Is Someone Who

question 48

Multiple Choice

An inflation dove is someone who:

• A)easily anchors inflation expectations.
• B)is not strongly committed to maintaining low inflation.
• C)is committed to maintaining low inflation even at the cost of reduced output and employment.
• D)believes monetary policy is more powerful than fiscal policy.

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Definitions:

New Deal

was a series of programs, public works projects, financial reforms, and regulations enacted by President Franklin D. Roosevelt in the United States during the 1930s to help alleviate the effects of the Great Depression.

Tax Increase

A rise in the amount of money that individuals or corporations must pay to the government based on earnings or purchases.

Federal Budget Deficit

The shortfall that occurs when the government's expenditures exceed its revenues in a fiscal year.

Economic Growth

An increase in a country's capacity to produce goods and services, reflected by an upward trend in national income, employment, and GDP.