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.

---

Definitions:

Permeability

The quality of allowing liquids or gases to pass through, commonly used in the context of materials, but also metaphorically to describe the flexibility and openness of systems or boundaries.

Self-assertion

The act of confidently and directly expressing one's opinions, needs, and rights without violating the rights of others.

Separateness

The state or condition of being distinct, individual, or not connected to others.

First-generation Immigrants

Individuals who have moved from their country of birth to reside in a different country, becoming the first in their family to do so.