Which of the Following Claims Is Consistent with the Views

question 18

Multiple Choice

Which of the following claims is consistent with the views of mainstream economists?

• A)If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will temporarily fall.
• B)If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will temporarily rise.
• C)If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will permanently fall.
• D)If we increase the rate of inflation from 3 percent to 6 percent,then the rate of unemployment will permanently rise.

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Definitions:

Risk

The uncertainty as to the future returns of a particular financial investment or economic investment.

Occupational Segregation

The division of labor in which certain jobs are more frequently held by members of a particular gender, ethnicity, or race.

Crowding Model

is a theory suggesting that too much investment in a particular area can reduce its overall effectiveness or efficiency.

Domestic Output

The overall value of goods and services produced domestically in a country within a set period.