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What were the twin economic challenges McMahon's government faced in its last year?

  • High inflation and unemployment

  • Recession and trade deficit

  • Stagflation and budget deficit

  • Inflation and increased imports

Answer

McMahon's government faced two major economic challenges in its last year in office: high inflation and unemployment. The inflation rate reached 13.5% in 1974, and unemployment rose to 6%. These problems were exacerbated by the global oil crisis, which caused oil prices to quadruple. The government's attempts to address these problems were unsuccessful, and it was voted out of office in 1975.
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