The following shows the effect of the business cycle on the inflation rate and the unemployment rate:

The following shows the effect of the business cycle on the inflation rate and the unemployment rate:



A. The unemployment rate increases and the inflation rate increases during expansion
B. The unemployment rate increases and the inflation rate falls during expansions
C. The unemployment rate increases and the inflation rate falls during recessions
D. The unemployment rate falls and the inflation rate falls during recessions




Answer: C


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