Government Can Push the Unemployment Rate Below the Natural Rate

question 57

Multiple Choice

Government can push the unemployment rate below the natural rate only by

• A) instituting supply-side economic policies.
• B) producing a higher rate of inflation than people expect.
• C) balancing the federal budget.
• D) achieving zero inflation.

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Definitions:

Businesses

Entities engaged in commercial, industrial, or professional activities, aiming to generate profits from the goods or services they offer.

Craft Union

Labor union whose members all have a particular skill or occupation.

Bargaining Power

The capacity of one party in a negotiation to influence the terms of an agreement or the balance of power between negotiating parties.

Supply

The total amount of a product or service available for purchase in a market.