A central bank finds itself in the following situation: The national economy has been in a slump for several years, but recent signs of strength in much of the economy have led many forecasters to conclude that an expansion could finally be in the offing. Nevertheless, the unemployment rate is at its highest level in more than three decades, even though a recent increase in the price level may have signaled that inflation, which has been dormant for several years, could be about to take off again.
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A central bank finds itself in the following situation The nation.docx
1. A central bank finds itself in the following situation: The
national economy has been in a slump for several years, but
recent signs of strength in much of the economy have led many
forecasters to conclude that an expansion could finally be in the
offing. Nevertheless, the unemployment rate is at its highest
level in more than three decades, even though a recent increase
in the price level may have signaled that inflation, which has
been dormant for several years, could be about to take off again.
