Given a Phillips Curve with Stable and Predictable Inflation and Unemployment

question 1

Multiple Choice

Given a Phillips Curve with stable and predictable inflation and unemployment rate tradeoffs, it appears that:

• A) An expansionary fiscal policy can shift the curve to the left
• B) A tight money policy can shift the curve to the right
• C) Manipulating aggregate demand through fiscal and monetary policies has the effect of causing a movement along the curve
• D) Manipulating aggregate demand through fiscal and monetary policies has the effect of shifting the curve

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