The Phillips Curve Shows the Relationship Between Various Rates of Unemployment

question 350

Multiple Choice

The Phillips curve shows the relationship between various rates of unemployment and

• A)interest rates.
• B)real wage rates.
• C)inflation.
• D)the money supply.
• E)investment demand.

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Definitions:

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance premiums.

Law Of Diminishing Returns

An economic principle stating that if one input in the production of a commodity is increased while all other inputs are held fixed, a point will eventually be reached at which additions of the input yield progressively smaller, or diminishing, increases in output.

Fixed Factor

A resource in the production process that remains constant, regardless of the level of output or production over a certain time period.

Total Product Curve

A graphical representation showing the output of a firm in relation to a single input while holding other inputs constant.