In Comparison to When Monetary Policy Is Not Contractionary, Under

question 34

Multiple Choice

In comparison to when monetary policy is not contractionary, under a contractionary monetary policy, the unemployment rate is____ and the inflation rate is____ over time.

• A)higher; higher
• B)higher; lower
• C)lower; lower
• D)lower; higher

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Definitions:

Accuracy

The degree to which the result of a measurement, calculation, or specification conforms to the correct value or a standard.

Precision

The degree to which repeated measurements under unchanged conditions show the same results.

Precise

Referring to the closeness of two or more measurements to each other, showing little variance when repeated.