Exam 17: The Short-Run Trade-Off Between Inflation and Unemployment

If policymakers expand aggregate demand, then in the long run

A movement to the right along a given short-run Phillips curve could be caused by

If inflation is less than expected, then the unemployment rate is

If the central bank raises the rate at which it increases the money supply, then in the short run unemployment is

Although monetary policy cannot reduce the natural rate of unemployment, other types of government policies can.

In the long run, an increase in the money supply growth rate

Other things the same, if the central bank decreases the rate at which it increases the money supply, then

In the United States during the 1970s, expected inflation

The economist A.W. Phillips published a famous article in 1958 in which he showed a

During the mid and last part of the 1990's both inflation and unemployment were low. In general this could have been the result of

A decrease in expected inflation shifts

The natural rate of unemployment is the same as the socially optimal rate of unemployment.

A. W. Phillips' findings were based on data

A favorable supply shock will shift short-run aggregate supply

In the short run, policy that changes aggregate demand changes

In the long run an increase in the money supply growth rate affects

Figure 17-1. The left-hand graph shows a short-run aggregate-supply (SRAS) curve and two aggregate-demand (AD) curves. On the right-hand diagram, U represents the unemployment rate. -Refer to Figure 17-1. What is measured along the horizontal axis of the left-hand graph?

In the long run, an increase in the money supply growth rate

Other things the same, in the long run a country that reduces the minimum wage from very high levels will have

In the equation, Unemployment rate = Natural rate of unemployment - a $\times$ ctual inflation - Expected inflation), The variable a is a parameter that measures how much