Question: In 1980, the inflation rate in the US was 12.5%. At that time, the consensus outlook claimed inflation could not decline by more than 1% per year. That turned out to be incorrect, as it fell to 3.8% in 1982 and remained near that level. Over the same period, the average gain in wage rates fell from 11% to 4%. What does this evidence say about the relevance of the claim that ‘‘sticky'' wages and prices cause high unemployment?