During an expansion,how do inflation and unemployment typically change?
A)Inflation and unemployment both rise.
B)Inflation and unemployment both fall.
C)Inflation falls and unemployment rises.
D)Inflation rises and unemployment falls.

Question

Quizplus · Accepted Answer

During an expansion, as the economy is growing and businesses are investing and hiring more, there is an increase in demand for goods and services. This usually leads to a rise in prices, which is reflected in an increase in inflation. At the same time, as more jobs are created, unemployment typically falls as people are able to find work. Therefore, inflation rises and unemployment falls during an expansion.

During an Expansion,how Do Inflation and Unemployment Typically Change