LG 1. Knowledge Comprehension

LO 1.1. Generate knowledge of core concept and theory
A central bank launches a retail digital currency (CBDC) to improve monetary control. How might this influence inflation and unemployment in the short run?

Question

LG 1. Knowledge Comprehension

LO 1.1. Generate knowledge of core concept and theory 
  A central bank launches a retail digital currency (CBDC) to improve monetary control. How might this influence inflation and unemployment in the short run?

Answer

CBDC issuance raises long-term inflation while lowering unemployment permanently.

Answer

Digital currency circulation eliminates the inflation–unemployment trade-off entirely.

Answer

Improved policy transmission enables better inflation control with smaller increases in unemployment.

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LG 1. Knowledge Comprehension LO 1.1. Generate knowledge of core concept and...

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