Suppose the Federal Reserve Makes Monetary Policy More Expansionary

question 142

Multiple Choice

Suppose the Federal Reserve makes monetary policy more expansionary.In the long run

• A)both inflation and the unemployment rate are higher than they were prior to the change in policy.
• B)inflation is higher and the unemployment rate is the same as it was prior to the change in policy.
• C)inflation is lower and the unemployment rate is lower than it was prior to the change in policy.
• D)inflation is lower and unemployment is the same as it was prior to the change in policy.

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Definitions:

Manufacturer

A person or company that makes goods for sale, typically involving machinery and labor.

Unit Contribution Margin

The amount by which the sale price of a unit exceeds its variable cost, indicating how much each unit contributes to covering fixed costs and generating profit.

Organic Fertilizer

A type of fertilizer made from natural organic materials, such as compost, manure, or bone meal, which enriches soil fertility without the use of synthetic chemicals.

Manufacturer

A person or company that makes goods for sale through the process of combining raw materials and components.