With a Permanent Acceleration in Nominal GDP Growth,an "Adjustment Loop

question 129

Multiple Choice

With a permanent acceleration in nominal GDP growth,an "adjustment loop" leaves us in the end with ________ output and ________ inflation.

• A)higher,unchanged
• B)higher,higher
• C)unchanged,unchanged
• D)unchanged,higher

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Definitions:

Exchange Rate

The amount one currency is valued at when translated into another currency.

Kilogram

The base unit of mass in the International System of Units (SI), equivalent to 1,000 grams or approximately 2.20462 pounds.

Long-Run Exchange Rate

The exchange rate that reflects the underlying fundamentals of an economy over a longer period, free from short-term fluctuations.

Subsidiary

A company controlled by another company, often referred to as its parent company.