An Increase in Expected Inflation Would Cause a Phillips Curve

question 11

Multiple Choice

An increase in expected inflation would cause a Phillips curve drawn with the inflation rate measured along the vertical axis to

• A) shift to the right by an amount equal to the increase.
• B) shift to the left by an amount equal to the increase.
• C) shift down by an amount equal to the increase.
• D) shift up by an amount equal to the increase.
• E) shift up and to the right by an amount equal to the increase measured along a 45-degree line from the origin.

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