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SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.128) Suppose the current inflation rate and the expected inflation rate are both 3 percent. Thecurrent unemployment rate and the natural rate of unemployment are both 4 percent. Usea Phillips curve graph to show the effect on the economy of a severe supply shock. If theFederal Reserve keeps monetary policy unchanged, what will eventually happen to theunemployment rate? Show this on your Phillips curve graph.128)Diff: 2Page Ref: 964-965/590-591Topic: Supply Shocks and the Phillips CurveLearning Outcome: Macro 13: Discuss the key measures, theories, and effects of inflation anddeflationAACSB: Analytic Skills129) Why is the credibility of the Fedʹs policy announcements particularly important?129)