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The Long-Run Phillips Curve Applies When the Economy Is at Full

question 4

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The long-run Phillips curve applies when the economy is at full employment, so the long-run Phillips curve is -------------------- which demonstrates that changes in the inflation rate-------------------- effect on unemployment.


Definitions:

Proportional Tax

A tax system where the tax rate remains constant regardless of the amount subject to taxation.

Regressive Tax

A tax system wherein the tax rate decreases as the taxable amount increases, placing a higher burden on lower-income earners.

Sales Tax

A tax on the value of goods sold.

Wealth Tax

A tax on the wealth of an individual.

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