The Price Level in the Economy Between 2010 and 2011

question 226

Multiple Choice

The price level in the economy between 2010 and 2011 rose from 100 to 110.Between 2011 and 2012, the price level rose from 110 to 121.How would the short-run Phillips curve predict the unemployment rate would change as a result?

• A)The unemployment rate would decrease since inflation decreased.
• B)The unemployment rate would decrease since inflation increased.
• C)The unemployment rate would increase since inflation increased.
• D)The unemployment rate will initially rise and then fall as inflation rises and falls.
• E)The unemployment rate would not change since there is no change in the rate of inflation.

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Definitions:

Olfactory Cortex

A region of the brain involved in the processing of smell information received from the olfactory receptors.

Sensory Receptors

Specialized cells or nerve endings that respond to changes in the environment and send signals to the central nervous system.

Nasal Cavity

The large air-filled space behind the nose that filters, warms, and humidifies inhaled air.

Free Nerve Endings

Sensory receptors found throughout the body that detect stimuli related to temperature, pain, and touch, contributing to the sensation of feeling.