According to Friedman and Phelps, No Matter What a Central

question 144

Multiple Choice

According to Friedman and Phelps, no matter what a central bank does to the money supply, what will happen in the long run?

• A) The economy will have a zero inflation rate.
• B) The unemployment rate will tend toward the natural rate of unemployment.
• C) The inflation rate will tend to the natural rate of inflation.
• D) The economy will have a zero unemployment rate.

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Definitions:

Individualism

A moral, political, or social outlook that emphasizes the moral worth of the individual and the priority of personal independence and rights.

Ethical Standards

The criteria that guide the behavior of individuals and organizations, reflecting what is morally right and wrong.

Fairness, Equity

The quality of being impartial and just, and ensuring individuals receive what they deserve based on their needs, conditions, and contributions.

Compromise

A settlement of differences by mutual concessions or modification of demands.