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If the Rate of Inflation in the Economy Is Steady

question 147

Essay

If the rate of inflation in the economy is steady at 5 percent per year,how does the short-run Phillips curve predict that the unemployment rate will be changing,if at all? Does your answer change if inflation in the economy is 0 percent? Illustrate your answer with a Phillips curve.


Definitions:

Dreamer

An individual prone to conceptual or fantastical thinking, often with a vivid imagination that transcends the common realities of life.

Rosalind Cartwright

A clinical psychologist known for her research on dreams and their connection to waking life.

Activation-Synthesis Model

A theory suggesting that dreams are caused by the brain trying to make sense of random neural activity during REM sleep.

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The process by which a neuron sends an electrical signal across a synapse to another neuron.

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