Which of the following would cause the economy's expected inflation rate to rise over time?

A. The Fed responds to supply shocks with extreme %26quot;hawkish%26quot; policies.

B. The Fed uses monetary policy to prevent changes in fiscal policy from affecting real GDP.

C. The Fed believes that the natural rate of unemployment is 5%, but it is really 6%.

D. The Fed believes that the natural rate of unemployment is 5%, but it is really 4%.

Which of the following would cause the economy%26#039;s expected inflation rate to rise over time?

C.

The fed will lower rates at 6% unemploy to spark the econ and get it down to 5. Lowering rates will mean more spending and hiring increasing inflation!

Which of the following would cause the economy%26#039;s expected inflation rate to rise over time?

loan

b is the only answer that makes sence.|||E. The Fed does something. Every move they make is designed to increase inflation, regardless of it%26#039;s %26quot;stated%26quot; intentions.