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Question

If a country’s policy makers were to continuously use expansionary monetary policy in an attempt to hold unemployment below the natural rate the long-run result would be?

A An increase in the level of output Correct Answer Incorrect Answer
B A decrease in the unemployment rate Correct Answer Incorrect Answer
C An increase in the rate of inflation Correct Answer Incorrect Answer
D All of these Correct Answer Incorrect Answer
E None of these Correct Answer Incorrect Answer

Solution

If a country’s policy makers were to continuously use expansionary monetary policy in an attempt to hold unemployment below the natural rate the long-run result would be An increase in the rate of inflation

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