The Short-Run Phillips Curve Is Downward Sloping Because

question 120

Multiple Choice

The short-run Phillips curve is downward sloping because

• A) the expected inflation rate is zero in the short run.
• B) the unemployment rate can be above or below the natural unemployment rate.
• C) reducing the unemployment rate will reduce the inflation rate in the short run.
• D) the economy always returns to full employment.
• E) in the long run, the expected inflation rate equals the actual inflation rate.

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Definitions:

Y-Intercept

The point where a line or curve crosses the y-axis of a graph, indicating the value of the dependent variable when the independent variable is zero.

Total Variation

The overall measure of variability or dispersion within a dataset.

Independent Variables

Variables in an experiment or statistical model that are manipulated or categorized to determine their effect on dependent variables.

Observations

Data collected during an experiment or research, representing values or occurrences recorded by the researcher.