Given the Augmented Phillips Model: Y = β₀ + β₁x₁

Given the augmented Phillips model: y = β₀ + β₁x₁ + β₂x₂ + ε, where y = actual rate of inflation (%) , x₁ = unemployment rate (%) , and x₂ = anticipated inflation rate (%) . The explanatory variable or variables in this model is (are) the ________.

A) unemployment rate
B) actual inflation rate
C) anticipated inflation rate
D) unemployment rate and anticipated inflation rate