Suppose the Long-Run Phillips Curve Shifts to the Right

question 64

Multiple Choice

Suppose the long-run Phillips curve shifts to the right. For any given rate of money growth and inflation, how would unemployment and output change?

• A) Unemployment would be higher, and output would be lower.
• B) Unemployment would be higher, and output would be higher.
• C) Unemployment would be lower, and output would be lower.
• D) Unemployment would be lower, and output would be higher.

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Definitions:

Acute Stress

A short-term form of stress resulting from specific events or situations that can be either positive or negative.

Adrenaline

A hormone released into the bloodstream in response to physical or mental stress, increasing heart rate and energy.

Irrational Fear

A fear that is not based on reason or reality, often disproportionate to the perceived threat.

Coping Mechanism

Strategies or behaviors used to manage stress, anxiety, or trauma.