Scenario 2
Suppose the natural rate of unemployment is 6 percent, the expected inflation is 2 percent, and the constant a in the short-run Phillips curve equation is 0.8.
-Referring to Scenario 2, describe the process of adjustment from the old to the new inflation-unemployment point when the expected inflation has changed.

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The Answer of Scenario 2
Suppose the natural rate of unemployment is 6 percent, the expected inflation is 2 percent, and the constant a in the short-run Phillips curve equation is 0.8.
-Referring to Scenario 2, describe the process of adjustment from the old to the new inflation-unemployment point when the expected inflation has changed.

Scenario 2 Suppose the Natural Rate of Unemployment Is 6 Percent, the Percent