Suppose an Economy Is Operating with a Recessionary Gap

Multiple Choice

Suppose an economy is operating with a recessionary gap. In this case, policymakers would seek to move the economy

A) back down the Phillips curve, trading a reduction in inflation for an increase in unemployment.
B) up the Phillips curve, trading a reduction in inflation for an increase in unemployment.
C) back down the Phillips curve, trading a reduction in unemployment for an increase in inflation.
D) up the Phillips curve, trading a reduction in unemployment for an increase in inflation.