Use the Information Below to Answer the Following Questions

question 39

Multiple Choice

Use the information below to answer the following questions.
Fact 28.4.1 Eurozone Unemployment Hits Record High As Inflation Rises Unexpectedly
Eurozone unemployment rose to 10.7 percent. At the same time, Eurozone inflation unexpectedly rose to 2.7 percent a year, up from the previous month's 2.6 percent a year.
Source: Huffington Post, March 1, 2012
-Consider Fact 28.4.1. Choose the statement that is incorrect about the Eurozone economy.

• A)The small rise in inflation brings a movement up along the short-run Phillips curve.
• B)The large increase in the natural unemployment rate shifts the short-run Phillips rightward.
• C)The tradeoff between inflation and unemployment became worse as the short-run Phillips curve shifted rightward.
• D)A rise in the expected inflation rate shifts the short-run Phillips curve rightward.
• E)The large increase in the natural unemployment rate shifts the long-run Phillips curve rightward.

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Definitions:

Net Present Value (NPV)

A financial metric that calculates the difference between the present value of cash inflows and outflows over a period of time, used to assess the profitability of an investment or project.

Net After-Tax Salvage Value

The estimated value of an asset at the end of its useful life, after subtracting any taxes associated with its disposal.

Operating Cash Flow

The cash generated from normal business operations, reflecting the company’s ability to generate sufficient revenue to cover its operational expenses.

Required Rate Of Return

The minimum percentage return an investor expects to receive from an investment to compensate for its risk.