The economy was in long-run equilibrium when aggregate demand increased. At this point in time, the expected inflation has started to adjust to the new higher actual inflation rate. According to the (Friedman) natural rate theory, this means the unemployment rate in the economy must currently be
A) decreasing.
B) increasing.
C) higher than it was in long-run equilibrium.
D) equal to what it was in long-run equilibrium.
E) There is not enough information to answer the question.
B
Economics
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The natural rate of unemployment consists of frictional unemployment plus structural unemployment
Indicate whether the statement is true or false
Economics
Suppose that steel produced this year is used to produce a car sold next year. The value of the steel ________ included in GDP this year as ________
A) is; an intermediate good B) is not; an intermediate good C) is; an adjustment to inventories D) is not; an adjustment to inventories
Economics