What Did Milton Friedman and E

Multiple Choice

What did Milton Friedman and E.S. Phelps argue with respect to the Phillips Curve?

A) The Phillips Curve could accurately guide activist policy makers over the long run.
B) The inverse relationship between unemployment and inflation only holds in the long run. In the short run, unemployment and inflation are positively related.
C) Economic participants would soon understand activist policymakers' strategy and revise their expectations, making discretionary efforts to fine-tune the economy ineffective.
D) The inflation rate will consistently be 2 percentage points below the unemployment rate.