What Did Milton Friedman and E

question 146

Multiple Choice

What did Milton Friedman and E.S. Phelps argue with respect to the Phillips Curve?

• A) The Phillips Curve could accurately guide activist policy makers over the long run.
• B) The inverse relationship between unemployment and inflation only holds in the long run. In the short run, unemployment and inflation are positively related.
• C) Economic participants would soon understand activist policymakers' strategy and revise their expectations, making discretionary efforts to fine-tune the economy ineffective.
• D) The inflation rate will consistently be 2 percentage points below the unemployment rate.

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Definitions:

Disjuncts

Components in a logical expression that are combined with an OR operator, where the expression is true if at least one of the disjuncts is true.

Disjunction

An operation in logic that returns true when a minimum of one input is true.

Tautologies

Statements that are true under any possible valuation of their components in logic.

Biconditional

A logical statement that is true only if both the conditions it connects are either true or false.