Answer to Question #253121 in Microeconomics for Khushi

Question

Imagine you are a policymaker trying to decide whether to reduce the rate of inflation, to make an intelligent decision what do you need to know about unemployment and inflation and trade offs between them!

Answer 1

It is important to study the inverse relationship between unemployment and inflation. In this case, unemployment reduction contributes to more inflation experienced within a place. There, as a policy maker I would study much on savings based on the employed and unemployment group.