One Implication of the Phillips Curve Analysis Is That

question 101

Multiple Choice

One implication of the Phillips curve analysis is that:

• A)unemployment rates below the natural rate are only possible in the long run.
• B)unemployment rates below the natural rate lead to falling rates of inflation in the long run.
• C)if inflationary expectations are accurate,the economy is on the short-run Phillips curve but not on the long-run Phillips curve.
• D)unemployment rates below the natural rate may be achieved only with rising inflation rates.
• E)the natural rate of unemployment is strictly a short-run phenomenon.

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Definitions:

Milli-

A prefix in the metric system denoting a factor of one thousandth (0.001) of the unit stated.

Axill-

A prefix denoting a relationship to the armpit or underarm area.

Chem/o

A combining form used in the fields of chemistry or pharmacology indicating a relation to chemicals or chemistry.

Macr/o

A prefix in medical terminology indicating large or long.