Identify how m and z may explain variations in the natural rate of unemployment across countries and across time.

Part $12$

A$.$

Only differences in z can explain variation across countries and only differences in m can explain variation across time.

B$.$

Differences in both m and z can explain variation across countries but only differences in z can explain variation across time.

C$.$

Differences in both m and z can explain variation across countries and across time.

D$.$

Only differences in m can explain variation across countries and only differences in z can explain variation across time.