Use the following to answer questions:
-(Figure: Short-Run Phillips Curve) Refer to Figure: Short-Run Phillips Curve. The natural rate of unemployment is _____%.
A) 3
B) 5
C) 7
D) 8

Question

Use the following to answer questions: 
-(Figure: Short-Run Phillips Curve) Refer to Figure: Short-Run Phillips Curve. The natural rate of unemployment is _____%.
A) 3 
B) 5 
C) 7 
D) 8

Quizplus · Accepted Answer

The natural rate of unemployment is the rate at which the short-run Phillips curve intersects the vertical long-run Phillips curve, typically representing the economy's equilibrium level of unemployment where inflation is stable. Without seeing the figure, the correct answer cannot be determined directly from the question. However, historically and theoretically, a natural rate of unemployment around 5% is often considered typical for many economies, making option B a plausible choice based on common economic principles.

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