If the input cost adjustment process works very slowly so that actual output differs from potential output for a long period of time, then O a. None of the answers is correct O b. Active stabilization policies are probably not justified Active stabilization policies are likely to create hyper-inflation O d. Active stabilization policy may widen the output gap even further

If the input cost adjustment process works very slowly so that actual output differs from potential output for a long period of time, then O a. None of the answers is correct O b. Active stabilization policies are probably not justified Active stabilization policies are likely to create hyper-inflation O d. Active stabilization policy may widen the output gap even further

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter22: Inflation

Section: Chapter Questions

Problem 33P: The index number representing the price level changes from 110 to 115 in one year and then from 115...

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The index number representing the price level changes from 110 to 115 in one year and then from 115 to 120 the next year. Since the index number increases by five each year, is five inflation rate each year? Is the inflation rate the same each year? Explain your answer.
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