If Wages and Prices Adjust Rapidly, We Would Expect Expansionary

question 167

Multiple Choice

If wages and prices adjust rapidly, we would expect expansionary monetary policy to be

• A)more likely to reduce the natural rate of unemployment.
• B)more likely to affect the unemployment rate.
• C)less likely to affect the unemployment rate.
• D)less likely to result in a vertical short-run Phillips curve.
• E)less likely to affect the exchange rate.

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