Author Question: If the expected inflation rate rises, then the short-run Phillips curve ________ and the long-run ... (Read 121 times)

kaid0807 · **on:** Jun 29, 2018

If the expected inflation rate rises, then the short-run Phillips curve ________ and the long-run Phillips curve ________.

A) does not shift; shifts
B) does not shift; does not shift
C) shifts; does not shift
D) shifts; shifts
E) might shift; shifts only if the short-run Phillips curve shifts

Question 2

Explain how the volunteer's dilemma is a special case of the public goods problem in which the possibility exists that no one will end up providing the public good.

What will be an ideal response?

InfiniteSteez · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

C

Answer to Question 2

The Volunteer's dilemma is a situation in which a single person can provide a public good. Because everyone benefits when the good is provided, and therefore property rights are not well defined, individuals face tension between their desire to see the good provided and and their desire to have someone else provide the good. This tension and the strategic behavior it causes create the possibility that no one will provide the good.