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Which of the Following Equations Summarize the Analysis of Friedman

Question 189

Multiple Choice

Which of the following equations summarize the analysis of Friedman and Phelps (where a is positive number) ?


A) unemployment rate = natural rate of unemployment - a(actual inflation - expected inflation)
B) unemployment rate = natural rate of unemployment - a(expected inflation - actual inflation)
C) unemployment rate = expected rate of inflation - a(actual inflation - expected inflation)
D) unemployment rate = actual rate of inflation - a(actual unemployment - expected unemployment)

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