Author Question: If workers and firms ignore inflation or form their inflation expectations adaptively, expansionary ... (Read 125 times)

Jramos095 · **on:** Jun 29, 2018

If workers and firms ignore inflation or form their inflation expectations adaptively, expansionary monetary policy will lower unemployment permanently.

Indicate whether the statement is true or false

Question 2

An increase in the price level results in a(n) ________ in household consumption spending and a(n) ________ in investment spending.

A) decrease; increase B) increase; decrease C) increase; increase D) decrease; decrease