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:

Filter

A device or process used to remove unwanted particles, contaminants, or substances from a fluid, air, or light.

New Products

Refers to the latest goods or services introduced to the market by companies aiming to meet consumer needs or offer innovative solutions.

Wastes

Materials that are not wanted and have been discarded.

Neurotoxin

Toxic substances that specifically damage nervous system cells, potentially leading to disruptions in normal function or death.