How Does a Decrease in the Expected Rate of Inflation

question 46

Multiple Choice

How does a decrease in the expected rate of inflation shift the Phillips curves?

• A) It shifts both the short-run and long-run Phillips curves to the right.
• B) It shifts the long-run Phillips curve left and the short-run Phillips curve right.
• C) It shifts only the short-run Phillips curve to the right.
• D) It shifts only the short-run Phillips curve to the left.

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Definitions:

Aerobic Respiration

A process of producing cellular energy involving oxygen. Cells use this method to convert glucose and oxygen into energy.

Photosynthesis

The process by which green plants and some other organisms use sunlight to synthesize nutrients from carbon dioxide and water.

Lactate Fermentation

An anaerobic metabolic process by which glucose or other six-carbon sugars are converted into cellular energy and the metabolite lactate, which is typical in muscle cells under high demand for energy.

Yogurt Production

The process of fermenting milk with specific bacterial cultures to produce yogurt, a thick, creamy, and slightly sour dairy product.