Some Economists Have Argued That Inflation During the 1970s Contributed

question 64

Multiple Choice

Some economists have argued that inflation during the 1970s contributed to the U.S.economy's relatively slow growth rate.What is the basis for this view?

• A)Inflation usually lowers employment,thus slowing growth.
• B)If inflation is anticipated,it is particularly harmful because cost of living increases are built into wage settlements,which only worsens the problem.
• C)High and variable inflation rates increased uncertainty,thus making business decisions more difficult.
• D)Lenders were less interested in making short-term loans than in making long-term loans.
• E)Inflation during the 1970s created increased activity on Wall Street,which drew funds that could have been used for truly productive purposes.

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Definitions:

Classical Conditioning

A conditioning method in which two stimuli are consistently paired together; over time, the reaction that was once generated by the second stimulus is drawn out by the first stimulus instead.

Modeling

The act of learning behavior, attitudes, or skills by observing and imitating others, as proposed in social learning theory.

Cognitive Development

The process by which individuals perceive, think, and gain understanding of their world through the interaction and influence of genetic and learned factors.

Jean Piaget

A Swiss psychologist known for his pioneering work in child development, particularly his theory of cognitive development.