Increased optimism about the future leads to rising prices and falling unemployment in the short run.

Question

Quizplus · Accepted Answer

Increased optimism about the future can lead to higher consumer and business spending, which in turn boosts demand for goods and services. This increased demand can cause prices to rise (due to higher demand relative to supply) and unemployment to fall as businesses hire more workers to meet the increased demand.

Increased Optimism About the Future Leads to Rising Prices and Falling