Exam 12: Unemployment and Inflation

A COLA is

An increase in the expected rate of inflation would

Because the natural rate of unemployment is not known precisely,policymakers who use it as a guide for policy must be

One cost of a perfectly anticipated inflation is that it

The Phillips curve is the relation between inflation and unemployment that holds for a given natural rate of unemployment and a

A difficulty faced by policymakers who wish to use the unemployment rate as a guide to whether the economy is weak or strong is that

In years when teenagers become a greater percentage of the labor force,

One cost of an unanticipated inflation is that it

Which of the following disinflationary monetary policies would classical economists prefer?

The Friedman-Phelps analysis suggests that there is a long-term relationship between

Suppose most people had anticipated that inflation would be 3% in the coming year because the Fed would increase the money supply by 3%.Instead,the Fed increases the money supply by 5%.In the short run,this would cause actual output to be ________ full-employment output and prices to increase by ________ 3%.