When economists say “sticky inflation,” they mean: inflation does not react dire
ID: 1112146 • Letter: W
Question
When economists say “sticky inflation,” they mean:
inflation does not react directly to changes in fiscal policy.
inflation does not immediately react to changes in monetary policy.
inflation adjusts quickly.
inflation never responds to monetary policy.
taxes do not react to changes in prices.
a.inflation does not react directly to changes in fiscal policy.
b.inflation does not immediately react to changes in monetary policy.
c.inflation adjusts quickly.
d.inflation never responds to monetary policy.
e.taxes do not react to changes in prices.
Explanation / Answer
Answer
Option a
inflation does not react directly to changes in fiscal policy.
The inflation does not respond to the fiscal policy and it adjusts slowly.
inflation does not react directly to changes in fiscal policy.
The inflation does not respond to the fiscal policy and it adjusts slowly.