The Phillips curve is the relationship between (a) Change in GDP from potential and inflation. (b) GDP and unemployment. (c) The percent change in GDP and inflation. (d) The percent change in GDP and unemployment.
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Q: 39. Model the Phillips curve and explain what the curve means in terms of policy.
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A: ANSWER STEP-1 Ans :- A The loss increases if Philips curve gets steeper or inelastic.
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- The Phillips curve shows the relationship between inflation and what? A) Unemployment. B) The rate of price increases. C) The balance of trade. D) The rate of growth in an economy.Question 30 The short-run Phillips curve is based on the assumption that there is_____. no relationship between the inflation and unemployment a direct relationship between the inflation and unemployment an inverse relationship between the inflation and unemployment a trade-off between the output and unemploymentTrue, false or obscure. Justify your conclusion. a) It is desirable to have inflation as close to zero as possible b) High inflation means low unemployment c) The turnover rate of money decreases when nominal interest rates are high d) The probability of the unemployed finding a job is greater if more people change jobs during a given period e) Sticky wages make the Phillips curve steep
- On a given short-run Phillips curve which of the following is held constant? a. the level of GDP b. employment c. the unemployment rate d. expected inflationThe Phillips Curve suggests that a government trying to reduce inflation must accept Select one: a. foreign aid. b. higher unemployment. c. stagflation. d. supply shocks. e. increased costs.Which of the following statements is correct? A) The short run Phillips curve is negatively sloped B) There is no inflation when the unemployment rate is zero C) The Phillips curve shows a negative correlation between the unemployment rate and GDP growth D) The short run Phillips curve is positively sloped
- Part a.: The Phillips curve slopes (downward/upward), since a more positive output gap is associated with a (higher/lower) level of unexpected inflation. The labor market Phillips Curve slopes (downward/upward), since a more positive output gap is associated with a (higher/lower) level of unemployment. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.What is true along the long-run Phillips curve? A. A labor shortage exists. B. A tradeoff exists between the inflation rate and the unemployment rate. C. The economy is at full employment. D. The inflation rate equals the expected inflation rate and any unemployment rate is possible.The axes below are for showing the Phillips curve model. The Phillips curve shows the trade off between (Select one: unemployment and economic growth/inflation and interest rates/ unemployment and inflation/ real GDP and the price level/ exports and imports/ wages and productivity) The long run Phillips curve would most likely go through points (Select one: ADF/ BEG/ DG/ ABC/ CE) Suppose that both axes are numbered 0 to 10. In June 2006 the NZ economy was most likely at about point (Select one: A/B/C/D/E/F/G). Following the global financial crisis, by June 2010 the NZ economy was most likely at approximately point (Select one: A/B/C/D/E/F/G) The key idea behind the long run Phillips curve is that (Select one below) 1. there is a long term trade off between the two variables on the axes but no short run trade off 2. in the short run lower values of the x-axis variable can be achieved at the expense of higher values of the y-axis variable 3. there is no long run trade off at all…
- The long-run Phillips curve will be vertical because: unemployment varies with inflation. unemployment is not affected by the inflation rate. the economy will eventually return to the natural rate of unemployment. people care more about the size of their wage, rather than what it can buy.Phillips Curve - This graph shows the inverse relationship between inflation and unemployment in the economy. It is used to illustrate the trade-off between inflation and unemployment and to help policymakers decide on appropriate policy responses. show this graph with an example.To pursue economic growth in the middle of the pandemic, the government decided to increase the government’s spending. Illustrate the effects of this policy by drawing the short run Phillips curves! What would happen in the long run?