The 'Phillips Curve' Shows the Short-Run Relationship Between

question 91

Multiple Choice

The 'Phillips curve' shows the short-run relationship between:

• A)real GDP and the inflation rate.
• B)real wages and real GDP.
• C)real wages and the inflation rate.
• D)the unemployment rate and the inflation rate.

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Definitions:

Real Wage Rate

The purchasing power of wages when adjusted for inflation, indicating the quantity of goods and services that can be bought.

Minimum Wage

The lowest legal salary that employers can pay their workers.

Million People

Denotes a population or group size consisting of approximately one million individuals.

Workers

Individuals engaged in any form of economic activity or employment, contributing to the production of goods and services.