The Initial Phillips Curve Relationship Implied That the Opportunity Cost

question 105

Multiple Choice

The initial Phillips curve relationship implied that the opportunity cost of __________ __________ was higher __________.

• A)reducing,unemployment,inflation
• B)increasing,unemployment,inflation
• C)reducing,unemployment,deflation
• D)increasing,employment,deflation
• E)reducing,employment,inflation

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Definitions:

Capital

Economic resources that are used in the production of goods and services, including buildings, machinery, equipment, and financial assets.

User Cost

The cost of using a durable good over time, considering depreciation and the opportunity cost of not investing funds elsewhere.

Economic Depreciation

A measure of the decrease in value of an asset over time due to use, wear and tear, and obsolescence.

Marginal Product

The increase in output that arises from an additional unit of input, holding all other inputs constant.