Problem
Assume that the information below shows the unemployment and inflation rate in Canada as a result of a shift in Aggregate Demand.
Unemployment rate Inflation rate
2015 3% 8%
2016 5% 5%
1. Assume that the natural rate of unemployment in Canada is 4%. Draw a correctly labeled graph of the long-run Phillips curve and label it as LRPC.
2. What is the relationship between the unemployment rate and the inflation rate in the long run?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.