Which of the Following Is NOT True for the Expectations-Augmented

question 18

Multiple Choice

Which of the following is NOT true for the expectations-augmented Phillips curve?

• A)the short-run curve shifts with changes in inflationary expectations
• B)the position of the curve depends on the expected rate of inflation
• C)if actual inflation is equal to expected inflation, we are at full-employment
• D)if unemployment is below its natural rate, the curve will shift to the right
• E)if wages and prices don't respond to changes in unemployment, the curve is vertical

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