(Figure: Understanding Phillips Curve Shifts) the Graph Shows Two Phillips

question 121

Multiple Choice

(Figure: Understanding Phillips Curve Shifts) The graph shows two Phillips curves. Suppose the economy originally faced curve PC₁. Which of these would cause the curve to shift to PC₂?

• A) Workers in the economy are expecting lower inflation.
• B) The natural rate of unemployment rose.
• C) The nonaccelerating inflation rate of unemployment increased.
• D) The actual unemployment rate fell.

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Definitions:

Wave Form

A graphical representation of the shape, amplitude, or frequency of a wave, especially as it relates to sound or electromagnetic waves.

Amplitude

The extent of a vibratory movement measured from the position of equilibrium.

Wavelength

The distance between successive crests of a wave, especially in sound or electromagnetic waves, determining its frequency and energy.

Purity

The state of being free from contamination, pollution, or other unwanted elements; often used in a moral or spiritual context to denote cleanliness or innocence.