If the Natural Unemployment Rate Increases, the Long-Run Phillips Curve

question 89

Multiple Choice

If the natural unemployment rate increases, the long-run Phillips curve ________, the short-run Phillips curve ________, and the expected inflation rate ________.

• A)does not shift; does not shift; does not change
• B)shifts rightward; shifts rightward; does not change
• C)does not shift; shifts rightward; rises
• D)shifts rightward; curve does not shift; falls
• E)shifts rightward; shifts rightward; falls

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Definitions:

Absorption Costing

A cost accounting method that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed overhead - in the cost of a product.

Unit Product Cost

The total cost (both variable and fixed costs) associated with producing a single unit of a product.

Variable Costing

A method of inventory costing that includes only variable production costs—direct materials, direct labor, and variable manufacturing overhead—in product costs, excluding fixed manufacturing overhead.

Per Unit

A term that refers to expressing costs, revenues, or any other financial metric on a per unit of production or per unit of sale basis.