Milton Friedman Argued That the Economy Is Not in Long-Run

question 128

Multiple Choice

Milton Friedman argued that the economy is not in long-run equilibrium if the expected inflation rate __________ the actual inflation rate.

• A) is less than
• B) is greater than
• C) equals
• D) a and b

---

Definitions:

Forward Exchange Contract

A financial agreement to exchange a set amount of currencies at a specified rate on a predetermined future date.

Cash Flow Hedge

A financial risk management tool aimed at safeguarding against variances in cash inflows and outflows due to market volatilities.

Amortized

Amortization involves spreading payments over multiple periods, such as loans or intangible assets, to reduce the balance over time.

Journal Entries

The means by which all business transactions are recorded in the accounting records using the double-entry bookkeeping system.