Illustrate the effects of the following developments on both the short-run and long-run Phillips curves. Give the
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Illustrate the effects of the following developments on both the short-run and long-run Phillips curves. Give the economic reasoning underlying your answers.
a. A rise in the natural rate of unemployment
b. A decline in the price of imported oil
c. A rise in government spending
d. A decline in expected inflation
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a A rise in the natural rate of unemployment shifts the longrun Phillips curve to the right and the ...View the full answer
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