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Business, 09.12.2019 17:31 needhelpasap4900

You are studying abroad in australia for a semester. unemployment has been creeping up and currently stands at 6%. this rate is getting a little too high for comfort, so the central bank of australia decides to do something about it. when you arrived in the country, inflation was hovering around 3% and had been at that level for a few years. the central bank’s action leads inflation to increase to 5%. a. what happens to unemployment in the short run if inflation is expected to be 0%? b. what happens to unemployment in the short run if citizens of australia have adaptive expectations? c. what happens to unemployment in the short run if citizens of australia have rational expectations?

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You are studying abroad in australia for a semester. unemployment has been creeping up and currently...
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