When an Increase in Aggregate Demand Causes Higher Inflation, the Central

question 44

Multiple Choice

When an increase in aggregate demand causes higher inflation, the central bank should _____ to bring inflation back to the target level.

• A) increase interest rates
• B) restrict exports
• C) increase the money supply
• D) manage the exchange rate

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Definitions:

Michael Hammer

A thought leader and author best known for his work on business process reengineering, which rethinks and radically redesigns business processes to achieve dramatic improvements in productivity and efficiency.

Employee Productivity

A measure of the efficiency and output of workers within a business or organization.

Workplace Equipment

Tools, machinery, and other physical devices or items used by employees to perform tasks and functions in the workplace.

Continuous Improvement

Continuous improvement is an ongoing effort to enhance products, services, or processes through incremental improvements over time or through breakthrough innovations.