Each point on a Phillips curve is a different combination of: O the interest rate and investment. inflation and unemployment. saving and disposable income. O price and quantity.
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- What does the Phillips Curve illustrate?A. The relationship between inflation and unemploymentB. The relationship between interest rates and investmentC. The relationship between government spending and economic growthD. The relationship between savings and consumptionThe Phillips curve describes the relationship between which two variables? the money supply and interest rates. O inflation and interest rates. aggregate expenditure and aggregate demand. O the unemployment rate and the rate of inflation.At which point is the unemployment rate equal to the natural rate of unemployment? O A. A B. B O C. C O D. There is insufficient information on the graph to answer this question. ..... Inflation rate (% per year) 8- 7- त 0- 5.5 0 1 Long-run Phillips curve B :3.8 с Short-run Phillips curve Unemployment rate (%)
- There are economists talking about the Phillips curve is a failure to predict the economy during the current pandemic . Which of the following statement about the Phillips curve is correct. O Phillips curve simply outlines the observation of a negative relationship between inflation and unemployment in data. The central banks should always design their policies according to the Phillips curve. Phillips curve predicts that high inflation leads to low unemployment rate. Phillips curve predicts that high unemployment rate cause low inflation.On a given short-run Phillips curve which of the following is held constant? a. the level of GDP b. employment c. the unemployment rate d. expected inflationThe idea that the actual rate of unemployment can influence the NAIRU is referred to as... O a. The market-clearing theory. O b. Efficiency-wage unemployment. O c. The Phillips curve. Od. Hysteresis. O e. Rational expectations.
- What is true along the long-run Phillips curve? A. A labor shortage exists. B. A tradeoff exists between the inflation rate and the unemployment rate. C. The economy is at full employment. D. The inflation rate equals the expected inflation rate and any unemployment rate is possible. th aht thanks1. Mutations of the Phillips curve Suppose that the Phillips curve is given by 7, = x; + 0.1– 2u, a. What is the natural rate of unemployment? Assume z; = Or, and suppose that 0 is initially equal to 0. Suppose that the rate of unemployment is initially equal to the natural rate. In year 1, the authorities decide to bring the unemployment rate down to 3% and hold it there forever. b. Determine the rate of inflation in years 1,t+1,1+2, and 1+5. c. Do you believe the answer given in (b)? Why or why not? (Hint: Think about how people are likely to form expectations of inflation.) Now suppose that in year 1+5, 0 increases from 0 to 1. Suppose that the government is still determined to keep u at 3% forever. d. Why might 0 increase in this way? e. What will the inflation rate be in years 1+5, 1+6, and 1+7? f. Do you believe the answer given in (e)? Why or why not?28 In applying the Phillips Curve, if Congress enacts expansionary policies to reduce unemployment, the cost is Multiple Choice O O an increase in the inflation rate. a decrease in the inflation rate. an increase in productivity. a decrease in productivity.
- An increase in expected inflation will O A. decrease the natural rate of unemployment. O B. shift the long - run Phillips curve to the right. OC. increase real wages. O D. None of the above is correct.1) True or False a)True or False? The unemployment rate measures the percentage of the adult populationthat is unemployed. b) True or False? The natural rate of unemployment is a positive rate of unemployment thatalways exists in a dynamic, ever-changing economy like that of the U.S c) The natural rate of unemployment (is zero, is constant, is positive and can change overtime).5. The Phillips curve in the late 20th century The following table shows selected data on unemployment and inflation in the United States between 1964 and 1968. Unemployment Rate Inflation Rate Year (Percent) (Percent) 1964 5.2 1.3 1965 4.5 1.6 1966 3.8 2.9 1967 3.8 3.1 1968 3.6 4.2 Plot the data for these five years on the following graph. Note: Vou will not be graded on how you plot the points, but plotting the points accurately on the graph will help you examine the relationship between unemployment and inflation during this period and solve the problems that follow. Data Points 2 4 UNEMPLOYMENT RATE (Percent) INFLATION RATE(Percent)