Exhibit 25-3 -Answer the Questions Below:
(A) Is There a Urique

question 45

Essay

Exhibit 25-3 $$\begin{array} { | c | c | } \hline \begin{array} { c } \text { Inflation } \\\text { (percent) }\end{array} & \begin{array} { c } \text { Real GDP } \\\text { (billions of } \\\text { dollars) }\end{array} \\\hline 4.5 & 6,700 \\\hline 3.5 & 6,800 \\\hline 2.5 & 6,900 \\\hline 1.5 & 7,000 \\\hline 5 & 7,100 \\\hline\end{array}$$
-Answer the questions below:
(A) Is there a urique rate of inflation that carresponts to lang-run equalibrum? Exgalan. What determines the rate of inflation when the econory is at lang-run equilibrium?
(B) Suppose the central bark is interested in stimulating Jrowth in the ecanamy. Shauld it ain far a higher or lower target infletian rate? Will higher frowth be achieved in the shart run and the long run?

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