Draw Two SP Curves Intersecting LP;call the Upper Intersection Point

question 97

Multiple Choice

Draw two SP curves intersecting LP;call the upper intersection point A and the lower point B.The Fed promises to reduce inflation while maintaining natural unemployment.If the public believes the Fed,the economy moves from ________.Then if the Fed turns out to be time-inconsistent,breaking its promise and trading off ________ inflation for lower unemployment,the public revises the way it forms inflation expectations so that in the long run the economy stays at ________.

• A)A to B,lower,B which is superior to A
• B)A to B,higher,A which is inferior to B
• C)A to B,lower,A which is superior to B
• D)B to A,higher,B which is superior to A
• E)B to A,lower,B which is inferior to A

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Definitions:

Media Assertion

The act of stating something strongly and publicly by the media.

Realistic Accuracy Model

A framework proposing that accurate judgment of others' personalities is based on the relevance, availability, detection, and utilization of behavioral information.

Extraversion

A characteristic of an individual that includes being outgoing, conversational, bold, and demonstrating a significant amount of emotional openness.

Realization

The act of becoming fully aware of something as a fact or understanding a concept completely.