DSE 2012 Q.52

[Do bats eat cats?]

In the 52nd question, do we have to equate the expected price level and the actual price level? If so, why?

[Devika]

Because the natural rate of unemployment is the rate of unemployment that prevails when the price level is equal to the expected price level.

[Do bats eat cats?]

Ah thanks! I guess I should've known that :|