In 1968, Economist Milton Friedman Published a Paper That Was

question 186

Multiple Choice

In 1968, economist Milton Friedman published a paper that was critical of the Phillips curve. On what grounds did Friedman criticize the Phillips curve?

• A) It seemed to work for wages but not for inflation.
• B) Monetary policy was ineffective in combating inflation.
• C) The tradeoff illustrated by the Phillips curve did not apply in the long run.
• D) Phillips had made errors in collecting his data.

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Definitions:

Budgeted Sales

Projected sales revenue, often part of a company’s financial planning process to estimate future income from sales.

Cash Disbursements

Outflows of cash for expenses, investments, and other payments made by a business.

Materials Purchases

The acquisition of raw materials or supplies required for the production of goods or provision of services.

Payment Discount

A reduction in the invoice amount offered by a seller to the buyer in return for early payment within a specified time frame.