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The Inflation Rate Has Been 3 Percent Per Year for Several

Question 114

Multiple Choice

The inflation rate has been 3 percent per year for several years,and the unemployment rate has been stable at 5 percent.Unanticipated changes in government policy cause the inflation rate to increase to 6 percent.In the short run,we would expect the unemployment rate to


A) remain constant.
B) increase to 10 percent.
C) increase,but the exact amount cannot be known for sure.
D) decrease.

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