3 UnexpectedInflationPhillipscurveRegion0%Region0%Output gapIn Region B, any positive unexpected inflation is likely to be caused byO higher input prices, leading producers to raise product pricesO cost-push inflationdemand-pull inflationO demand-push inflation

Short run Philips curve shows inverse relationship between inflation and unemployment.

Unexpected Inflation Phillips curve Region 0% Region 0% Output gap In Region B, any positive unexpected inflation is likely to be caused by higher input prices, leading producers to raise product prices O cost-push inflation demand-pull inflation O demand-push inflation

Unexpected Inflation Phillips curve Region 0% Region 0% Output gap In Region B, any positive unexpected inflation is likely to be caused by higher input prices, leading producers to raise product prices O cost-push inflation demand-pull inflation O demand-push inflation

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter7: Unemployment And Inflation

Section: Chapter Questions

Problem 4.10P

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Question

Unexpected
Inflation
Phillips
curve
Region
0%
Region
0%
Output gap
In Region B, any positive unexpected inflation is likely to be caused by
O higher input prices, leading producers to raise product prices
O cost-push inflation
demand-pull inflation
O demand-push inflation

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