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    蓝听雨
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    There is often a trade-off between unemployment and inflation, where policies aimed at reducing unemployment can increase inflation, and vice versa. Low unemployment occurs when aggregate demand is high, but if demand grows too quickly it can overheat the economy and lead to inflation. Central banks must carefully balance these factors to achieve stable prices and full employment.

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    There is often a trade-off between unemployment and inflation, where policies aimed at reducing unemployment can increase inflation, and vice versa. Low unemployment occurs when aggregate demand is high, but if demand grows too quickly it can overheat the economy and lead to inflation. Central banks must carefully balance these factors to achieve stable prices and full employment.

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    5 views1 page

    The Trade

    Uploaded by

    蓝听雨
    There is often a trade-off between unemployment and inflation, where policies aimed at reducing unemployment can increase inflation, and vice versa. Low unemployment occurs when aggregate demand is high, but if demand grows too quickly it can overheat the economy and lead to inflation. Central banks must carefully balance these factors to achieve stable prices and full employment.

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    © All Rights Reserved
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    The trade-off between unemployment and inflation—IBDP Economics HL 2022 November Paper 1 15-

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