As Incorrectly Low Inflation Expectations Catch Up with the Higher

question 40

Multiple Choice

As incorrectly low inflation expectations catch up with the higher actual inflation rate,the SRAS curve shifts __________ and the short-run Phillips curve shifts __________.

• A) leftward; downward
• B) rightward; upward
• C) leftward; upward
• D) rightward; downward

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Definitions:

Total Liabilities

The sum of all current and long-term obligations that a company owes to others.

Total Current Assets

The sum of all assets expected to be converted into cash, sold, or consumed within one year or the operating cycle, whichever is longer.

Base Year Figure

A benchmark or reference point in time used for comparative analysis, often in the calculation of indexes and financial ratios.

Retained Earnings

Net income retained in a corporation.