The first variable I chose was the unemployment rate. This is the annual average of persons 15 years of age or older, actively seeking and available for work, but unemployed. (BLS). The relationship between unemployment and inflation "provides evidence of a short-run trade-off between the two variables known as the short-run Phillips curve" (BLS). The relationship suggests that by accepting higher inflation levels, the Fed can use monetary policy to stimulate the economy and temporarily reduce unemployment. When prices go up, the wages are affected also. This occurs because if no adjustments

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Approximate Word count = 938
Approximate Pages = 4 (250 words per page double spaced)