Figure 132 Alt Text for Figure 13

question 131

Multiple Choice

Figure 13.2 Alt text for Figure 13.2: In figure 13.2, a graph shows the short-run and long-run Phillips curves.
Long description for Figure 13.2: The x-axis is labelled, unemployment rate (percent) .The y-axis is labelled, inflation rate (percent per year) .3 points; A (5, 3) , B (3.8%, 5.5%) , C (6, 1) are plotted on the graph.The points are connected to their respective coordinates on the x and y-axes with dotted lines.A straight line labelled, short-run Philips Curve, begins at the top left corner and slopes down to the bottom center, and passes through points A, B, and C.A straight line labelled, long-run Philips Curve, is perpendicular to the x-axis, begins from the x-axis value 5,and intersects the Short-run Philips Curve at point A.
-Refer to Figure 13.2.Suppose the economy is at point B in the figure above.Which of the following is true?

• A)The expected rate of inflation is 3%.
• B)The natural rate of unemployment is 3.8%.
• C)The current unemployment rate is 5%.
• D)The economy is producing at potential GDP.
• E)Expected inflation and actual inflation are the same.

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Definitions:

Potential Disadvantages

Possible negative outcomes or drawbacks that may arise from a particular action, decision, or situation.

Life Cycle

The sequence of stages or phases that an organism, product, or service goes through from its inception to its termination or death.

Stages

Distinct phases or steps within a process or lifecycle, each characterized by unique features, challenges, or goals.

Adjourning

The final phase in group development where the team completes its tasks and disbands, typically associated with project teams or temporary committees.