Refer to the Above Diagram for a Specific Economy

question 50

Multiple Choice

Refer to the above diagram for a specific economy.Which of the following best describes the relationship shown by this curve?

• A)The demand for labor is large when the rate of inflation is small.
• B)When the rate of unemployment is high, the rate of inflation is high.
• C)The rate of inflation and the rate of unemployment are inversely related.
• D)The rate of inflation and the rate of unemployment are directly related.

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Definitions:

Merchandise Inventory

Items purchased by a company for the purpose of being sold to customers; considered a current asset on the balance sheet.

Accounts Payable

Money owed by a company to its creditors for goods or services that have been received but not yet paid for.

Prepaid Insurance

An asset account that represents insurance payments made in advance of the period in which the insurance coverage applies.