How Does the Short-Run Phillips Curve Reflect an Increase in the Price

question 140

Multiple Choice

How does the short-run Phillips curve reflect an increase in the price of oil such as occurred in the early 1970s?

• A) as a leftward shift in the short-run Phillips curve
• B) as a rightward shift in the short-run Phillips curve
• C) as a downward movement along the short-run Phillips curve
• D) as an upward movement along the short-run Phillips curve

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Definitions:

Influential Observations

Data points that have a significant impact on the result of a statistical analysis, potentially skewing the outcome.

Simple Linear Regression

A method in statistics that models the relationship between two variables by fitting a linear equation to the observed data.

Least-squares Regression Line

A straight line that best models the relationship between a dependent and independent variable by minimizing the sum of the squares of the vertical distances of the points from the line.

MPG

Miles Per Gallon, a measure of fuel efficiency used in the United States to indicate how many miles a vehicle can travel per gallon of fuel.