If the Inflation Rate Is Decreasing While Unemployment Is Decreasing

question 4

Multiple Choice

If the inflation rate is decreasing while unemployment is decreasing:

• A)​the short-run Phillips curve must have shifted right.
• B)​the short-run Phillips curve must have shifted left.
• C)​it involved a movement along the short-run Phillips curve.
• D)​it would be inconsistent with any possible Phillips curve scenario.

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Definitions:

Corporations

Legal entities that are separate from their owners, with the ability to own property, incur liabilities, and sell stock.

Corporation

A business firm that is a legal person. Its chief advantage is that each owner’s liability is limited to the amount of money he or she invested in the company.

Stockholders

Individuals or entities that own shares in a corporation, possessing ownership interests and rights to dividends.

Owned

The state of having legal rights to possess, use, and control a property or asset.