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For this question, use the Modified Phillips relation we saw in class: t=teplus0.25minus4ut. let te=(t-1) . Suppose that inflation in year 1 is zero. In
For this question, use the "Modified" Phillips relation we saw in class: t=teplus0.25minus4ut. let te=(t-1) . Suppose that inflation in year 1 is zero. In year t, the authorities decide to keep the unemployment rate at 5% forever. Compute the rate of inflation for year's + 2. Question 35Select one: a. 20% b. 5% c. 10% d. 15%
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