bbonds2004 bbonds2004

27-06-2024
Mathematics

Answered

According to Country A's Phillips curve, the sum of inflation and unemployment rates remains constant at some particular level. Last year, the unemployment rate in Country A was 8%
, while the difference between the unemployment rate and the inflation rate was 1
percentage point. This year, the government decides to decrease the unemployment rate by 2.5
percentage points. Calculate this year's inflation rate based on the Phillips curve.

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