The Phillips Curve Describes the Relationship Between

question 10

Multiple Choice

The Phillips curve describes the relationship between

• A)inflation and interest rates.
• B)aggregate expenditure and aggregate demand.
• C)unemployment and the rate of change of wages.
• D)the money supply and interest rates.
• E)the output gap and potential GDP.

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Definitions:

Discounting Note Receivable

The process of reducing the value of a note receivable to reflect its current worth by applying an interest rate.

Endorsing Note

A legal act of signing the back of a negotiable instrument, such as a check, to assign its benefits to another party.

Bank Discount Rate

The interest rate at which a country's central bank lends money to domestic banks, often used as a benchmark for other interest rates.

Proceeds of the Note

The total amount of money received from issuing a note payable, including the principal and any interest.