e 32 Question 10 means that when something increases, something else may decreas

Question

e 32 Question 10 means that when something increases, something else may decrease"). Economists believe that (Note: In this question,"tradeoff there is usually a A short-run tradeoff between inflation and unemployment. O O B short-run tradeoff between the current unemployment rate and the natural rate of unemployment. C long-run tradeoff between inflation and unemployment. ° D long-run tradeoff between the current unemployment rate and the natural rate of unemployment. O Unanswered 5:39 PM dy 12/7/201 /

Explanation / Answer

10> A

Reason

This short run trade-off is precisely described in the Philips curve.

11> C

Due to lesser demand, the price will get lower. Thus, the inflation rate will decline but unemployment will rise due to less production.

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