Use the Following to Answer Questions

question 58

Multiple Choice

Use the following to answer questions:
-(Figure: Expected Inflation and the Short-Run Phillips Curve) SRPC₀ is the Phillips curve with an expected inflation rate of zero; SRPC₂ is the Phillips curve with an expected inflation rate of 2%. Refer to Figure: Expected Inflation and the Short-Run Phillips Curve. Suppose that this economy has an unemployment rate of 6%, no inflation, and no expectation of inflation. If the central bank increases the money supply such that aggregate demand shifts to the right and unemployment falls to 4%, then inflation will:

• A) fall to -2%.
• B) not change.
• C) rise to 2%.
• D) rise to 4%.

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Definitions:

Hans Eysenck

A German-born British psychologist known for his work on intelligence and personality, particularly his development of the three-factor model of personality.

Unconditioned Stimulus

An impulse that inherently induces a reaction without requiring earlier education.

Classical Conditioning

Learning through the process of associating a naturally spontaneous stimulus with one that is prompted by environmental factors.

Pathological Behaviours

Pathological behaviors are actions or practices that are considered abnormal or maladaptive, often related to mental health conditions.