A Difficulty Faced by Policymakers Who Wish to Use the Unemployment

question 2

Multiple Choice

A difficulty faced by policymakers who wish to use the unemployment rate as a guide to whether the economy is weak or strong is that

• A)the natural rate of unemployment is hard to measure.
• B)the natural rate of unemployment almost never changes.
• C)policymakers must use data on output to tell whether the unemployment rate is too high or too low.
• D)the impact of policy on the economy is subject to long and variable lags.

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