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Suppose that more unemployed people who are classified as part of frictional unemployment decide to stop looking for work and start their own business instead.

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Suppose that more unemployed people who are classified as part of frictional unemployment decide to stop looking for work and start their own business instead. What is likely to happen to the following, other things being equal? a) The natural rate of unemployment [2] b) The economy’s Phillips curve. [2] c) How can we shift the long-run Phillips curve to the left?