Author Question: The short-run Phillips curve shows that: a. the economy can have low inflation and low unemployment ... (Read 55 times)

magmichele12 · **on:** Jun 30, 2018

The short-run Phillips curve shows that:
a. the economy can have low inflation and low unemployment simultaneously.
b. the economy can have high per-capita income and high interest rate simultaneously.
c. a reduction in per-capita income comes at the expense of lower inflation.
d. a reduction in unemployment comes at the expense of higher inflation.
e. a reduction in inflation comes at the expense of lower exchange rate.

Question 2

Suppose the economy had been operating along a given short-run Phillips curve for several years and then experienced a year of stagflation. The year of stagflation would:
a. be represented as a move upward along the short-run Phillips curve.
b. be represented as a move downward along the short-run Phillips curve.
c. be represented as a point above the short-run Phillips curve.
d. be represented as a point below the short-run Phillips curve.
e. correspond to the origin.