In the Short Run, Fiscal and Monetary Policy Cause Unemployment

question 86

Multiple Choice

In the short run, fiscal and monetary policy cause unemployment and inflation to move in opposite directions because

• A)the Fed and Congress rarely agree on policy.
• B)one controls aggregate demand, the other controls aggregate supply.
• C)both policies control only aggregate supply.
• D)both policies control only aggregate demand.

---

Definitions:

Bird

A warm-blooded vertebrate of the class Aves, characterized by feathers, beaks, the laying of hard-shelled eggs, and (in most cases) the ability to fly.

Identify

To establish or indicate who or what (someone or something) is.

Folk Theories

Informal, intuitive, and often culturally specific beliefs or explanations about the world and how it works, not necessarily based on scientific evidence.

Ambiguous Sentences

Phrases or expressions that can be interpreted in more than one way due to vague or multiple meanings of words or structure.