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What Is an Advantage of Mild Inflation According to Some

Question 170

Multiple Choice

What is an advantage of mild inflation according to some economists?


A) It helps to close the GDP gap.
B) It reduces the inflation premium.
C) It makes it easier for firms to adjust real wages downward as demand for their products falls.
D) It reduces frictional, structural, and cyclical unemployment in the economy to make the economy more productive.

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