Assume an economy is in a long-run equilibrium. Following a decrease in aggregate demand, which of the following is true in the short run?
A
The unemployment rate is equal to the natural rate of unemployment, and the rate of inflation is rising.
B
The unemployment rate is greater than the natural rate of unemployment, and the rate of inflation is rising.
C
The unemployment rate is greater than the natural rate of unemployment, and the rate of inflation is declining.
D
The unemployment rate is lower than the natural rate of unemployment, and the rate of inflation is declining.
E
The unemployment rate is lower than the natural rate of unemployment, and the unemployment rate is rising.

The OECD defines unemployment as those over a certain age who are currently available for work but are not currently employed or self-employed. The number of unemployed people as a percentage of the labor force is used to calculate the unemployment rate, which is used to calculate the level of unemployment. There are various types of unemployment, including frictional, structural, cyclical, voluntary, and involuntary. There are numerous factors that originate from both the supply side, or the worker, and the demand side, or the employer, that contribute to unemployment. High-interest rates, the world economy being in a recession, and the financial crisis might all affect demand. Frictional unemployment and structural employment are major supply-side contributors.

To learn more about unemployment click on the given link:

https://brainly.com/question/305041

#SPJ1