Ultimately,the change in unemployment associated with a change in inflation is due to
A)the shape of the long-run aggregate supply curve.
B)unanticipated inflation,not inflation per se.
C)anticipated inflation,not inflation per se.
D)a change in the natural rate of unemployment.

Question

Quizplus · Accepted Answer

Unanticipated inflation can temporarily reduce unemployment by lowering real wages, leading firms to hire more workers. However, anticipated inflation is usually factored into wage contracts and prices, so it doesn't affect unemployment.

Ultimately,the Change in Unemployment Associated with a Change in Inflation