Question: This monetary policy increases/decrease s the economy's demand for goods and services, leading to higher/lower product prices. In the short run, the change in prices

This monetary policy increases/decreases the economy's demand for goods and services, leading to higher/lower product prices. In the short run, the change in prices induces firms to produce more/fewer goods and services. This, in turn, leads to a lower/higher level of unemployment.

In other words, the economy faces a trade-off between inflation and unemployment: Higher inflation leads to higher/lower unemployment.

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