An economy experiences a decade in which the quarterly unemployment rate fluctuates between 2.5% and 3.5%. Due to a number of shocks the economy gets into problems and the unemployment rate increases by 0.5%-point per quarter (So it become 4.0% in Q1, 4.5% in Q2, 5% in Q3 and 5.5% in Q4, also in the second year after the shock the unemployment rate continues to increase.

This experience is consistent with:

1. a locally and globally stable equilibrium
2. a locally and globally unstable equilibrium
3. a locally unstable and globally stable equilibrium
4. a locally stable and globally unstable equilibrium