The Idea That,in the Long Run,the Phillips Curve Is Vertical,implying

question 49

Multiple Choice

The idea that,in the long run,the Phillips curve is vertical,implying no trade-off between inflation and unemployment,is based on the premise that

• A)inflation and unemployment are unrelated.
• B)expectations do not adjust to reflect actual inflation.
• C)changes in unemployment do not influence real GDP.
• D)inflationary expectations fully adjust to actual inflation.
• E)inflationary expectations do not influence inflation.

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Definitions:

Algae

A diverse group of photosynthetic organisms, ranging from unicellular microalgae to large multicellular forms, that are typically found in aquatic environments.

Insect Larvae

are the juvenile form of insects following hatching from eggs, before metamorphosing into their adult forms.

Detritus Food Chain

A series of processes by which nutrients are recycled in an ecosystem, starting from organic waste and decomposing organisms to detritivores and then to their predators.

Decaying Matter

Organic material that is breaking down through the process of decomposition by microorganisms.