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Refer to the Above Diagram and Assume the Economy Is

Question 77

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Refer to the above diagram and assume the economy is initially at point b<sub>1</sub>.According to the adaptive expectations theorists, the long-run relationship between the unemployment rate and the rate of inflation is represented by: A) the line connecting B<sub>1</sub> and C<sub>1</sub>. B) the line through B<sub>1</sub>, B<sub>2</sub>, B<sub>3</sub>, and B<sub>4</sub>. C) the line connecting C<sub>1</sub> and B<sub>2</sub>. D) any line parallel to the horizontal axis. Refer to the above diagram and assume the economy is initially at point b1.According to the adaptive expectations theorists, the long-run relationship between the unemployment rate and the rate of inflation is represented by:


A) the line connecting B1 and C1.
B) the line through B1, B2, B3, and B4.
C) the line connecting C1 and B2.
D) any line parallel to the horizontal axis.

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