Macroeconomics

Macroeconomics

In the late 1990s a growing number of economists argued that world policymakers were focusing too much on fighting inflation. The economists also argued that the technical level of potential output had risen. Show their argument using the AS/AD model.

A higher level of inflation was observed during the years of the 1970s and the years of the 1980s, when compared with the inflation rates of the previous periods in history. After remaining on a high for a period of two continous decades, the inflation rate was lowered by implementing a measure that helped in tightening the monetary policy in the ...