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The Cleveland Federal Reserve Bank's Estimate of Expected Inflation Has

Question 260

Multiple Choice

The Cleveland Federal Reserve Bank's estimate of expected inflation has fallen from 3.5 percent in 2000 to 1.5 percent in 2013. This fall means that


A) the long-run Phillips curve shifted leftward.
B) the long-run Phillips curve shifted rightward.
C) the long-run Phillips curve shifted downward.
D) None of the above answers are correct because a change in the expected inflation rate does not shift the long-run Phillips curve.

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