Figure 1-1 -When the Actual Unemployment Rate Is Likely to Exceed the Likely

Multiple Choice

Figure 1-1

-When the actual unemployment rate is likely to exceed the natural rate of unemployment,as in the time intervals between t1 and t2 and t3 and t4 in Figure 1-1 above,we can expect that

A) inflation is speeding up and real GDP is likely to exceed natural GDP.
B) inflation is slowing down and real GDP is likely to fall below natural GDP.
C) inflation is speeding up and natural GDP is likely to exceed real GDP.
D) inflation is slowing down and real GDP is likely to exceed natural GDP.