There are economists talking about the Phillips curve is a failure to predict the economy during the current pandemic . VWhich of the following statement about the Phillips curve is correct. Phillips curve simply outlines the observation of a negative relationship between inflation and unemployment in data. The central banks should always design their policies according to the Phillips curve. Phillips curve predicts that high inflation leads to low unemployment rate. Phillips curve predicts that high unemployment rate cause low inflation.

There are economists talking about the Phillips curve is a failure to predict the economy during the current pandemic . VWhich of the following statement about the Phillips curve is correct. Phillips curve simply outlines the observation of a negative relationship between inflation and unemployment in data. The central banks should always design their policies according to the Phillips curve. Phillips curve predicts that high inflation leads to low unemployment rate. Phillips curve predicts that high unemployment rate cause low inflation.

Principles of Economics, 7th Edition (MindTap Course List)

7th Edition

ISBN:9781285165875

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter35: The Short-Run Trade-off Between Inflation And Unemployment

Section: Chapter Questions

Problem 3QCMC

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What is the effect of an increase in aggregate demand on the short-run Phillips curve? When aggregate demand increases, _______. A. the short-run Phillips curve shifts upward B. the short-run Phillips curve shifts downward C. a movement occurs upward along the short-run Phillips curve D. a movement occurs downward along the short-run Phillips curve
32 There is a new central bank president who wants low inflation much more than the previous president did. According to the Augmented Phillips Curve Model, in this situation, which of the following would be the most help in keep unemployment from rising in the sort run? a.People know the central bank president's true desires and believe he will stay in office for a long time b.Peoples' wage wage contracts are long-lasting. c.People know the central bank president's true desires and believe that he will only be in office for a short time. d.People think that the central bank president's desires are the same as the previous president's and believe that the new president will be in office for a short time. e.People think that the central bank president's desires are the same as the previous president's and believe that the new president will be in office for a
The accompanying graph depicts the Short-Run Phillips O Curve (SRPC) when the public expects no inflation in the economy. Macmillan Learning a. According to this SRPC, what would inflation be if unemployment is 9%? 0 Incorrect b. Please move the SRPC line to reflect what would happen if the public's inflation expectations increased so that they now expect the inflation rate to increase by 2%. c. If the unemployment rate is still 9%, what is the new inflation rate after this change in expectations? % 2 % Inflation rate (%) 7 6 5 4 3 2 1 0 -1 -2 -3 0 1 SRPC 2 3 4 5 6 Unemployment rate (%) 7 8 9 10
Draw a correctly labeled graph showing a short-run Phillips curve with an expected inflation rate of 0% and the corresponding long-run Phillips curve a. b. On your graph, label the nonaccelerating inflation rate of unemployment On your graph, show what happens in the long run if the government decides to decrease the unemployment rate below the nonaccelerating inflation rate of unemployment. Explain. С.
er In 2017, nearly 3.5% of Vietnamese imports constituted of refined oil. If the price of oil rises significantly, what effect would this have on the Phillips curve in Vietnam? Real interest rate Unexpected inflation Decreased Interra Output gep cand Output gap Output gep Unexpected inflation ang costs Output gap
If a central bank had to give up its discretion and follow a rule that required it to keep inflation low, a. the short-run Phillips curve would shift up. b. the short-run Phillips curve would shift down. c. the long-run Phillips curve would shift right. d. the long-run Phillips curve would shift left.
What kind of changesin the economy might infuence the slope of the Phillips curve?
A politician blames the Federal Reserve for being "soft on unemployment" and claims that a permanently higher money supply growth rate will lead to a permanent reduction in the unemployment rate. The politician's argument is a. consistent with the long-run Phillips curve. Further, the long-run Phillips curve implies that such a policy would not increase inflation. b. inconsistent with the long-run Phillips curve. Further, the long-run Phillips curve implies that such a policy would increase inflation. c. inconsistent with the long-run Phillips curve. However, the long-run Phillips curve implies that such a policy would not increase inflation. d. consistent with the long-run Phillips curve. However, the long-run Phillips curve implies that such a policy would increase inflation.
A. What assumptions did Thomas Sargent make when he claimed that inflation is always and everywhere a fiscal phenomenon?" B. Why is it appropriate in the book's short-term model for the author to use the Phillips Curve as an Aggregate Supply curve? Does it capture the working of the labor market as well as an AS curve based, say, on sticky wages? C. Provide an example of the book's short-run model being based on "microfoundations."
Assume that an economy is initially at the natural rate of unemployment.a. Use a Phillips curve diagram to illustrate graphically how the inflation rate andunemployment rate change both in the short run and in the long run to anunexpected expansionary monetary policy.b. Use a Phillips curve diagram to illustrate graphically how the inflation rate andunemployment rate change both in the short run and in the long run to theannouncement of a credible plan of expansionary monetary policy whenpeople have rational expectations.
According to the short-run Phillips curve, if the central bank increases the money supply then O inflation and unemployment swill both rise O'inflation will fall and unempiloyment will rise O inflation and unemployment will both fall inflation will rise and unempiloyment will fall
Assume that inflation falls significantly below expectations. Diagramboth the short-run and long-run effects on employment using a PhillipsCurve diagram. What changes in this model to allow the return to long-runequilibrium?