Policymakers Can Affect Inflation and Unemployment in the Short Term

question 13

Multiple Choice

Policymakers can affect inflation and unemployment in the short term by

• A)eliminating externalities.
• B)giving the central bank independence.
• C)changing the amount that the government spends.
• D)encouraging firms to think at the margin.

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Definitions:

Value Increase

An appreciation in the worth or market value of an asset over time.

Time To Expiration

The duration remaining until the expiration date of a financial contract, most commonly used in the context of options or other derivative instruments.

Call Increases

The rise in the value or price of call options, which are contracts granting the right to purchase a stock at a specified price within a certain period.

Value

The monetary, material, or assessed worth of an asset, good, or service.