Technically, the ECB Has a Dual Mandate of Price Stability

question 118

Multiple Choice

Technically, the ECB has a dual mandate of price stability and support of the European economies; but in practice, it seems to favor ______ over ______.

• A) lowering unemployment; controlling inflation
• B) promoting equality; lowering unemployment
• C) price stability; economic performance, growth, and employment
• D) women's rights; lower taxes on small business

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Definitions:

Say's Law

An economic theory that suggests that supply creates its own demand, meaning that production inherently generates a demand for the goods produced.

Open Economy

An economy linked to the rest of the world through international trade.

Equilibrium GDP

The level of GDP at which total demand for goods and services equals total supply in an economy, indicating a state of economic balance.

Aggregate Demand

The entirety of demand for goods and services within an economy, at a chosen general price level and throughout a specified time period.