During a stagflation phase,
A) inflation and unemployment both increase.
B) inflation and unemployment stay the same.
C) inflation and unemployment both decrease.
D) unemployment decreases and inflation increases.

Question

Quizplus · Accepted Answer

Stagflation is a rare occurrence where inflation and unemployment both increase. This means that prices are rising, but the economy is not growing and jobs are harder to come by. It is a difficult economic situation that can be challenging to address.

During a Stagflation Phase