What happened to the inflation rate between the year when the unemployment rate was 4.5% and the year when it was 3.5%? O The inflation rate decreased from 1.9% to 1.5%. O The inflation rate decreased by 2 percentage points. O The inflation rate increased from 2.9% to 4.3%. O The inflation rate increased by 3 percentage points. The points on the graph represent observations along the U.S. economy's Phillips curve during the 1960s. If the inflation rate had been 2.5
What happened to the inflation rate between the year when the unemployment rate was 4.5% and the year when it was 3.5%? O The inflation rate decreased from 1.9% to 1.5%. O The inflation rate decreased by 2 percentage points. O The inflation rate increased from 2.9% to 4.3%. O The inflation rate increased by 3 percentage points. The points on the graph represent observations along the U.S. economy's Phillips curve during the 1960s. If the inflation rate had been 2.5
Chapter13: Inflation
Section: Chapter Questions
Problem 10SQ
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Transcribed Image Text:Hint: Use the graph to answer the following questions. Click on any black point (plus symbol) on the graph to get its exact coordinates.
What happened to the inflation rate between the year when the unemployment rate was 4.5% and the year when it was 3.5%?
O The inflation rate decreased from 1.9% to 1.5%.
O The inflation rate decreased by 2 percentage points.
The inflation rate increased from 2.9% to 4.3%.
O The inflation rate increased by 3 percentage points.
The points on the graph represent observations along the U.S. economy's Phillips curve during the 1960s. If the inflation rate had been 2.5% during
the 1960s, the unemployment rate would most likely have been:
O 6.0%
O 2.8%
O 5.5%
O 4.1%
Transcribed Image Text:The following graph shows the combinations of unemployment and inflation that existed in the United States from 1961 through 1969.
NFLATION RATE (Percent)
5.0
4.5
4.0
3.5
2.5
2.0
1.5
1.0
0.5
0
3.0
*
3.5
69
68
++
67
66
*65
5.5, 1.4
64
+ 62
+
5.0
+
63
4.0 4.5
5.5
6.0
UNEMPLOYMENT RATE (Percent)
61
+
6.5
7.0
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