Figure 16-4
-Refer to Figure 16-4. What is the natural rate of unemployment?
A)0 percent
B)2 percent
C)5 percent
D)8 percent

Question

Figure 16-4 
-Refer to Figure 16-4. What is the natural rate of unemployment?
A)0 percent 
B)2 percent 
C)5 percent 
D)8 percent

Quizplus · Accepted Answer

In the long run, the Phillips curve is vertical at the natural rate of unemployment, indicating that there is no trade-off between inflation and unemployment. From the graph, we can see that the natural rate of unemployment is at point NRU, which is approximately 5 percent.

Figure 16-4 -Refer to Figure 16-4. What Is the Natural Rate of Natural