Analyze the relationship between unemployment and inflation during a recession and its implications for economic policy.

• A. Unemployment decreases while inflation increases, suggesting a need for policies that reduce unemployment.
• B. Both unemployment and inflation increase, suggesting a need for policies that control inflation.
• C. Unemployment increases while inflation decreases, suggesting a need for policies that stimulate demand.
• D. Both unemployment and inflation decrease, suggesting a need for policies that increase supply.

Answer: (C)