Question: you are the new leader of egypts central bank egypt...
You are the new leader of Egypt’s central bank. Egypt has been experiencing high inflation, and your task is to reduce that inflation rate.
a. What policy actions can your central bank take to reduce inflation? (3 points)
b. In a well-labeled graph, show how your policy actions affect the trade-off between inflation and unemployment in the short and long run. (5 points)
c. Explain how inflation and unemployment change over time as a result of your policy actions (3 points).