Which piece of advice would a neoclassical economist most likely give to the president of the...
Which piece of advice would a neoclassical economist most likely give to the president of the United States?
a. Investment in job training pays a higher dividend than investment in welfare spending.”
b. "Reducing the trade deficit is the key to ensuring long-term economic health."
c. "The best way to prevent a recession is through proactive changes in fiscal policy.
d. "The only way to decrease unemployment is to risk a short-term rise in inflation."
Homework Answers
d. "The only way to decrease unemployment is to risk a short-term rise in inflation."
(The philips curve was derived by neoclassicals which shows that unemployment and inflation are inversely related so a neoclassical economist most likely advise the president of the United States that the only way to decrease unemployment is to risk a short-term rise in inflation.)
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