Economic models in which the NAIRU can be influenced by changes in the actual rate of unemployment are said to include

Question

Quizplus · Accepted Answer

Economic models that include hysteresis suggest that the NAIRU may be influenced by changes in the actual rate of unemployment due to the long-term effects of unemployment on the labor market. This means that a period of high unemployment may permanently raise the NAIRU, while low unemployment may lower it. The other options listed do not necessarily suggest that the NAIRU is influenced by changes in the actual rate of unemployment.

Economic Models in Which the NAIRU Can Be Influenced by Changes