In the Short Run, Efforts to Reduce the Unemployment Rate

question 155

Multiple Choice

In the short run, efforts to reduce the unemployment rate are likely to cause

• A)a decrease in the inflation rate.
• B)an increase in the inflation rate.
• C)no change in the inflation rate.
• D)Uncertain-economists have found no relationship between the two variables.

---

Definitions:

Fair Return

A reasonable profit level that a utility or service provider is allowed to earn, taking into account the need to provide goods or services at fair prices.

Economic Profit

The contrast between total financial gain and overall financial obligations, including both explicit and implicit expenditures.

Marginal Cost

The financial burden of producing a further unit of a product or service.

Average Cost Pricing

A pricing strategy where the price is set based on the average cost per unit produced, including fixed and variable costs.