Answer
0.125 percentage points of inflation per percentage point increase of deficit
Work Step by Step
The average rate of change of f(x) over the interval [a,b] is $\frac{f(b)−f(a)}{b−a}$
Units: unit of f(x) per unit of x
Given the interval [0,4] and points (0,2) and (4,2.5) on the graph,
The average rate of change of f(x) over the interval [0,4]
$\frac{f(4)−f(0)}{4−0}=\frac{2.5-2}{4}=0.125$ (units: percentage points of inflation per percentage point increase of deficit)
