Multiple Choice
The economy's unemployment rate is 10% and the inflation rate is 1%. The most appropriate policy for the Bank of England to pursue would be to
A) increase the money supply to try to reduce the unemployment rate.
B) raise interest rates to try to stimulate saving.
C) reduce the money supply to try to bring the inflation rate to zero.
D) do nothing because the inflation rate is so low.
Correct Answer:
Verified
Correct Answer:
Verified
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