An Important Implication of the Natural Rate Hypothesis Is That

question 132

Multiple Choice

An important implication of the natural rate hypothesis is that the government policy that results in low inflation is generally the optimal long-run policy

• A)only if there is no cyclical unemployment in the short run
• B)only if there is no structural unemployment in the short run
• C)regardless of concerns about unemployment
• D)regardless of concerns about currency exchange rates
• E)only if the dollar's exchange rate is stable