If the Natural Unemployment Rate Increases, the Long- Run Phillips

question 6

Multiple Choice

If the natural unemployment rate increases, the long- run Phillips curve _______, the short- run Phillips curve _______, and the expected inflation rate _______ .

• A)does not shift; shifts rightward; rises
• B)shifts rightward; curve does not shift; falls
• C)does not shift; does not shift; does not change
• D)shifts rightward; shifts rightward; falls
• E)shifts rightward; shifts rightward; does not change

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Definitions:

Manufacturing Overhead

All manufacturing costs that are not directly related to the production of a product, such as factory rent, utilities, and maintenance.

Flexible Budget

A customizable budget that adjusts based on operational volume or activity fluctuations.

Activity Level

A factor that measures the amount of production or work accomplished, often used in cost accounting to determine costs based on different levels of operation.

Activity Variance

A metric used in cost accounting to measure the difference between planned activity and actual activity, often analyzed to improve budgeting and control processes.