Which of the following is consistent with the Phillips curve?
A) If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will temporarily fall.
B) If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will temporarily rise.
C) If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will permanently fall.
D) If we increase the rate of inflation from 3 percent to 6 percent, then the rate of unemployment will permanently rise.
Correct Answer:
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