Inflation and unemployment | Business & Finance homework help
Based on the data provided, there appears to be a negative correlation between the unemployment and inflation rates of the three countries. As can be seen in the graph above, when one country’s unemployment rate increases (Denmark), its inflation rate decreases significantly while when another country’s unemployment rate decreases (United States), its inflation rate increases. This suggests that a higher unemployment rate is associated with lower inflation rates and vice versa. However, it should also be noted that this relationship may not hold across all countries as other economic factors such as productivity levels and monetary policy will play an important role in determining these trends.