If Inflation Expectations Rise,the Short-Run Phillips Curve Shifts

question 140

Multiple Choice

If inflation expectations rise,the short-run Phillips curve shifts

• A)right,so that at any unemployment rate inflation is higher in the short run than before.
• B)left,so that at any unemployment rate inflation is higher in the short run the before.
• C)right,so that at any unemployment rate inflation is lower in the short run than before.
• D)left,so that at any unemployment rate inflation is lower in the short run than before.

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Definitions:

Financial Leverage

A technique employed by companies to increase their market value and return on investment by using debt to finance its operations.

EBIT

Earnings Before Interest and Taxes, a measure of a company's profitability calculated by excluding interest and income tax expenses.

Breakeven Diagrams

Graphical representations that show the point at which total costs and total revenue are equal, indicating no net loss or gain.

Unit Sales

The total number of individual items or products sold within a specific period.