Inflation Inertia Is the Tendency for Inflation to

question 149

Multiple Choice

Inflation inertia is the tendency for inflation to

• A) equal zero.
• B) change relatively slowly from year to year.
• C) decrease when the Bank of Canada increases interest rates.
• D) increase when the Bank of Canada decreases interest rates.
• E) redistribute resources to low-spending households.

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Definitions:

Deregulation

Refers to the reduction or elimination of government power in a particular industry, usually enacted to create more competition within the industry.

Carter And Reagan Administrations

The presidential terms of Jimmy Carter (1977-1981) and Ronald Reagan (1981-1989), notable for distinct economic and foreign policies.

Banking

The business activity of accepting and safeguarding money owned by other individuals and entities, and then lending out this money in order to earn a profit.

Airlines

Companies that operate aircraft for transporting passengers and cargo from one place to another.