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Inflation and Unemployment

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The topics of macroeconomics--inflation, unemployment, interest rates, and exchange rates--are the subject of newspaper headlines and television stories everyday. In your own words, discuss how these concepts relate to each other.

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The relation between Inflation and Unemployment is depicted by the Phillips curve. Typically, lower the unemployment, higher is the nominal increase in wages which implies lower the unemployment, higher the inflation. This makes sense because if ...

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