ECONOMICS 1120199 - 172 RefertoFigure17-7..TheFed ,andit succeeds.,the rateofunemploymentw

ECONOMICS 1120199 - 172 RefertoFigure17-7..TheFed ,andit...

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172)Refer to Figure 17-7.Consider the Phillips curves depicted in the graph above. The Fedannounces its intention to decrease inflation from 10 percent to 5 percent per year, and itsucceeds. If expectations of inflation are reduced to 8 percent by the Fedʹs announcement, therate of unemployment will be ________ in the short run. A) less than 5.5 percentB) 5.5 percentC) between 5.5 and 7.5 percentD) 7.5 percentAnswer: C 172) Page Ref: 995 - 996/613 - 614 Learning Outcome: Macro - 17: Discuss the fundamentals of key macroeconomic theories. 173)Refer to Figure 17-7.Consider the Phillips curves depicted in the graph above. The Fedannounces its intention to decrease inflation from 10 percent to 5 percent per year, and itsucceeds. If the assumptions of the rational expectations school hold true, and the Fedʹsannouncement is credible, the rate of unemployment will be ________ in the short run. Page Ref: 995 - 996/613 - 614 Learning Outcome: Macro - 17: Discuss the fundamentals of key macroeconomic theories. Figure 17 - 8 174) Refer to Figure 17 - 8. A typical long - run Phillips curve would have the appearance of a curve running through points A) B and C . B) A and B . C) A and C . D) A , B , and C . 174) Answer: A Page Ref: 995 - 996/613 - 614 Learning Outcome: Macro - 13: Discuss the key measures, theories, and effects of inflation and deflation. 41
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175) If wages and prices adjust rapidly, we would expect expansionary monetary policy to be 175) Page Ref: 995 - 996/613 - 614 Learning Outcome: Macro - 13: Discuss the key measures, theories, and effects of inflation and deflation. 176) When individuals use ________ about an economic variable to make a decision, expectations arerational. 176) Page Ref: 996 - 997/614 - 615 Learning Outcome: Macro - 17: Discuss the fundamentals of key macroeconomic theories.
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