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In the Long Run, When the Actual Inflation Rate Gets

Question 124

Multiple Choice

In the long run, when the actual inflation rate gets embedded in people's expectation:


A) the trade-off between inflation and unemployment becomes even stronger.
B) it is possible to achieve lower unemployment in the long run by accepting higher inflation.
C) there is no longer a trade-off between inflation and unemployment.
D) actual inflation at any unemployment rate is always higher than expected inflation.

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