Multiple Choice
If inflation expectations rise, how do the short-run Phillips curve and unemployment change?
A) The short-run Phillips curve shifts right, so that at any inflation rate unemployment is higher.
B) The short-run Phillips curve shifts left, so that at any inflation rate unemployment is higher.
C) The short-run Phillips curve shifts right, so that at any inflation rate unemployment is lower.
D) The short-run Phillips curve shifts left, so that at any inflation rate unemployment is lower.
Correct Answer:
Verified
Correct Answer:
Verified
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