The figure above shows some Phillips curves for an economy. -Along the short-run Phillips curve SRPC₀ in the figure above, the natural unemployment rate is A) 6 per cent. B) 8 per cent. C) 3 per cent. D) 4 per cent. E) an amount that can be determined from the figure but none of the above answers is correct.

Question

Quizplus · Accepted Answer

The natural unemployment rate is the unemployment rate at which the economy is at full employment. In the figure, the natural unemployment rate is 6 percent, which is the unemployment rate at which the SRPC0 curve intersects the vertical axis.

The Figure Above Shows Some Phillips Curves for an Economy