Author Question: In the short run, an expansionary monetary policy by the Fed would: a. reduce unemployment at the ... (Read 79 times)

future617RT · **on:** Jun 30, 2018

In the short run, an expansionary monetary policy by the Fed would:
a. reduce unemployment at the cost of higher inflation.
b. reduce inflation at the cost of a rise in the natural rate of unemployment.
c. reduce inflation and leave the natural unemployment rate unchanged.
d. reduce both inflation and unemployment.
e. increase both inflation and unemployment.

Question 2

If a price floor is not binding, then
a. the equilibrium price is above the price floor.
b. the equilibrium price is below the price floor.
c. there will be a surplus in the market.
d. Both (a) and (c) are correct.