A Decrease in the Inflation Target by the Central Bank

question 102

Multiple Choice

A decrease in the inflation target by the central bank would:

• A)Have no impact on the positioning of the dynamic aggregate demand curve
• B)Cause the dynamic aggregate demand curve to shift to the left
• C)Cause the dynamic aggregate demand curve to shift to the right
• D)Be reflected by a movement down and along the existing dynamic aggregate demand curve

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Definitions:

Right-to-Work Laws

Legislation that prohibits union security agreements between companies and workers' unions, allowing individuals to work without the requirement to join the union or pay dues.

Taft-Hartley Act

An American federal statute from 1947 designed to curtail the actions and influence of labor unions.

AFL-CIO

The American Federation of Labor and Congress of Industrial Organizations, a federation of labor unions in the United States, representing the collective interests of workers.

Strikes

Work stoppages initiated by employees as a form of protest, typically in an effort to gain better pay or working conditions.