The natural rate of unemployment is not lowered by high inflation,so higher inflation cannot produce lower unemployment or more employment in the long run.

Question

Quizplus · Accepted Answer

The natural rate of unemployment is not related to inflation and is a reflection of the structural and frictional factors in an economy. Therefore, high inflation cannot reduce the natural rate of unemployment, and policies aimed at reducing unemployment by increasing inflation are unlikely to be sustainable in the long run.

The Natural Rate of Unemployment Is Not Lowered by High