One of the Reasons Why the Phillips Curve Is No

question 182

Multiple Choice

One of the reasons why the Phillips curve is no longer viewed as a "menu" of possible choices available to policymakers is that

• A)in the 1970s and 1980s there was no inflation at all.
• B)analysis indicates there was no such "menu" in the 1960s.
• C)in the 1970s and 1980s much inflation came from the supply side.
• D)economic theory is unable to explain the curve and, therefore, it has been rejected.

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Definitions:

Discount

A reduction in the price of goods or services, often to attract consumers or to reward volume purchases.

Effective Interest Method

An accounting technique used to calculate the amortized cost of a bond or loan and to allocate the interest expense over the borrowing's life.

Sold At A Discount

The sale of an asset or service for a price lower than its nominal or face value.

Classified Balance Sheet

A financial statement that groups a company's assets, liabilities, and equity into categories for detailed analysis.