Author Question: Friedman's theory of the natural rate of unemployment and output a. indicates the power of the ... (Read 65 times)

vHAUNG6011 · **on:** Jun 30, 2018

Friedman's theory of the natural rate of unemployment and output

a. indicates the power of the central bank to target levels of unemployment.
b. demonstrates the limits to the trade-off between inflation and unemployment.
c. is the theoretical foundation for the monetarist belief that, in the long run, the influence of the money stock is primarily on the price level and other nominal variables.
d. both b and c.
e. all of the above.

Question 2

Under perfect capital mobility, an increase in world interest rates will

a. increase income and reduce domestic interest rates.
b. increase income.
c. increase income and lead to a balance of payment deficit.
d. increase income and lead to a balance of payment surplus.