Economists have observed that as an economy grows the


Economists have observed that as an economy grows the unemployment rate tends to fall. Which statement is most probable to be correct?

1) A decreasing unemployment rate causes economic growth.

2) Economic growth and the unemployment rate are positively correlated.

3) Increased economic growth causes a decline in the unemployment rate.

4) This is likely to be a spurious relationship and there is no real relationship between the unemployment rate and economic growth.

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Microeconomics: Economists have observed that as an economy grows the
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