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Review Eye on Inflation: What Causes Inflation? in the eText or click on the iconLOADING...to open a copy. Now answer the following questions. Part 2

Review Eye on Inflation: What Causes Inflation? in the eText or click on the iconLOADING...to open a copy. Now answer the following questions. Part 2 What must the Fed do to keep the inflation rate at 2 percent per year if real GDP grows at an average rate of 3 percent per year? The Fed must _______. A. keep the unemployment rate equal to 5 percent, the natural rate B. keep the interest rate steady at 5 percent per year C. control wages to make them grow at a rate of 5 percent per year D. make the quantity of money grow at a rate of 5 percent per year

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