Suppose the Expected Inflation Rate Is 12 Percent and the Unemployment

question 60

Multiple Choice

Suppose the expected inflation rate is 12 percent and the unemployment rate is 5 percent.If the expected inflation rate increases to 13 percent,

• A) the short-run Phillips curve will shift upward.
• B) the short-run Phillips curve will shift downward.
• C) there will be a movement along the short-run Phillips curve.
• D) the natural unemployment rate will rise.

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Definitions:

Mean IQ Score

The average score derived from a set of intelligence quotient (IQ) test results.

Restandardize

The process of revising and updating standards or norms, typically in the context of tests or measurements, to reflect current information or conditions.

Mean Score

A statistical measure that represents the average value of a set of numbers.

Standard Deviation

A statistical measure that quantifies the amount of variation or dispersion of a set of data values.