The IA Line Shows

question 121

Multiple Choice

The IA line shows

• A)the rate of change in the rate of inflation.
• B)the change in the rate of inflation needed to reach the target inflation rate.
• C)the point where real and potential GDP are equal.
• D)the price level in the economy at any point in time.
• E)the level of inflation in the economy at any point in time.

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Definitions:

Cyclical Unemployment

A type of unemployment that relates to the cyclic trends in the economy over time, often tied to changes in the business cycle.

Overall Unemployment Rate

The percentage of the labor force that is jobless and actively seeking employment, reflecting the health of an economy.

Inflation

The upward movement in the overall price points of goods and services, cutting down on purchasing strength.

Average Price Level

A measure of the overall level of prices in an economy, often considered in terms of a price index.