The Phillips Curve Depicts the Relationship Between

question 6

Multiple Choice

The Phillips curve depicts the relationship between

• A) output and the price level.
• B) aggregate demand and aggregate expenditures.
• C) inflation and unemployment.
• D) money supply and interest rates.

---

Definitions:

Substitution Effect

The economic principle that as prices rise (or incomes decrease), consumers will replace more expensive items with less costly alternatives.

Output Effect

The impact on an organization's total output resulting from a change in price, affecting the quantity supplied or demanded.

Substitute Resource

A resource that can be used in place of another, often relevant in the context of production or environmental sustainability.

MRP Curve

The marginal revenue product curve, which shows the additional revenue generated by one additional unit of an input.