What Is an Advantage of Mild Inflation According to Some

question 35

Multiple Choice

What is an advantage of mild inflation according to some economists?

• A) It helps to close the GDP gap.
• B) It reduces the inflation premium.
• C) It makes it easier for firms to adjust real wages downward as demand for their products falls.
• D) It reduces frictional, structural, and cyclical unemployment in the economy to make the economy more productive.

---

Definitions:

Slavery

A system where individuals are owned by others, deprived of personal freedom and forced to perform labor or services against their will.

Eighteenth Century

A period from 1701 to 1800 that is marked by significant historical events including the Enlightenment and the American Revolution.

Artisan Shops

Small-scale businesses specializing in handmade or traditional products, often emphasizing quality and craft.

Eighteenth-Century Slavery

The period marked by widespread use of slave labor, particularly in the American colonies and the Caribbean, where African slaves were forcibly brought to work on plantations.