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The medium-run equilibrium is characterized by four conditions: 1. Output is equal to potential output Y = Y, and the real policy rate In must be chosen by the central bank so: 2. The unemployment rate is equal to the natural rate u = Un. 3. The real policy interest rate is equal to the natural rate of interest , where , is defined as the policy rate where Y, = C (Y, -T) + 1( Y, ( +x) + G. 4. The expected and actual rate of inflation it is equal to the anchored or target rate of inflation, It. This implies the nominal policy rate i = ( + n. Which of the following best characterizes the behavior of inflation in a medium-run equilibrium if the level of expected inflation is formed so m equals it? O A. It cannot be determined. OB. O. O C. The same as In. OD. T