Scenario 35-2 ​

question 220

Multiple Choice

Scenario 35-2
​
In Flosserland, the Department of Finance is responsible for monetary policy. Flosserland has had an inflation rate of 25% for many years.
-Refer to Scenario 35-2. Suppose that the Flosserland Department of Finance undertakes a public relations campaign to convince people that it will soon change monetary policy to reduce inflation to 12.5%. If Flosserlanders believe their government then which, if any, curve(s) shift left?

• A)The short-run and the long-run Phillips curve
• B)The short-run but not the long-run Phillips curve
• C)The long-run but not the short-run Phillips curve
• D)Neither the short-run nor the long-run Phillips curve

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Definitions:

Productivity

The effectiveness of productive effort, especially in industry, as measured in terms of the rate of output per unit of input.

Experimental Group

The group in an experiment that receives the treatment or intervention under study, allowing researchers to measure its effects.

Room Temperature

The ambient temperature of a living space, usually considered to be around 20-22 degrees Celsius or 68-72 degrees Fahrenheit.

Aggressive Behaviour

Actions or responses by an individual that are intended to harm or intimidate another.