Question: A decrease in the natural unemployment rate _______ A. Shifts both the short-run and the long-run Phillips curves leftward B. Shifts the short-run Phillips curve

A decrease in the natural unemployment rate _______

A. Shifts both the short-run and the long-run Phillips curves leftward 

B. Shifts the short-run Phillips curve leftward but the long-run Phillips curve does not change 

C. Creates a movement along the short-run Phillips curve 

D. Increases the expected inflation rate and shifts the short-run Phillips curve upward

Step by Step Solution

★★★★★

3.38 Rating (170 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

A Figure ... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (2 attachments)

PDF file Icon

1448_6054778c361ee_660940.pdf

180 KBs PDF File

Word file Icon

1448_6054778c361ee_660940.docx

120 KBs Word File

Students Have Also Explored These Related Foundations Macroeconomics Questions!

Q:

Using the factors that influence the natural unemployment rate, explain what could cause the natural unemployment rate to increase.

Q:

In a certain economy, the expectations-augmented Phillips curve is and a. Graph the Phillips curve of this economy for an expected inflation rate of 0.10. If the central bank chooses to keep the...

Q:

1. Would a U6 version of the natural unemployment rate likely be higher or lower than the traditional natural unemployment rate? Explain your reasoning? 2. Why would using the U6 unemployment rate...

Q:

in details please!! 3) (30 pts) From the following graph, identify the initial equilibrium, the short-run equilibrium, and the long-run equilibrium based on the scenarios below. Explain your answers...

Q:

in details please close the output gap? 3) (30 pts) From the following graph, identify the initial equilibrium, the short-run equilibrium, and the long-run equilibrium based on the scenarios below....

Q:

(20) Answer the following: (6 marks) (A) If wages are sticky in the short-run, the short-run Phillips curve is downward sloping. TRUE / FALSE (B) A downward sloping Philips curve implies that output...

Q:

Answer the following: (6 marks) If wages are sticky in the short-run, the short-run Phillips curve is downward sloping. TRUE / FALSE A downward sloping Philips curve implies that output increases as...

Q:

1. A change in the expected price level shifts: Hide answer choices A. the short-run aggregate-supply curve, but not the long-run aggregate-supply curve B. the aggregate-demand curve C. both the...

Q:

Suppose the economy is in a long-run equilibrium. Questions 5.1 Explain the theory behind the shapes of the short-run and the long-run Phillips curves. Specifically explain why the short-run Philips...

Q:

1 A. Assume the following economy: Autonomous Consumption = 3 mils; Marginal Propensity to Consume = 0.8; Business Investment = 52; Government spending = 127 mils income tax rate = 40%. (a) Find the...

Q:

Explain why data redundancy exists for the attributes Discount and Location in the STOCK table in Figure 7.1c.

Q:

An employee earns $40 per hour and 1.75 times that rate for all hours in excess of 40 hours per week. Assume that the employee worked 60 hours during the week, and that the gross pay prior to the...

Q:

Brief Exercise 12-29 Net Present Value Tatsumi Inc. has just completed development of a new printer. The new product is expected to produce annual revenues of $4,050,000. Producing the printer...

Q:

10. Why is there more controversy about regulating industries where technology changes very rapidly?

Q:

Suppose that the government redistributes income by taxing the 60 percent of households with the highest market incomes 10 percent, then distributing the tax collected as an equal benefit to the 40...

Q:

Suppose that the government redistributes income by taxing the 60 percent of households with the highest market incomes 10 percent, then distributing the tax collected as an equal benefit to the 40...

Q:

Suppose that the government redistributes income by taxing the 60 percent of households with the highest market incomes 10 percent, then distributing the tax collected as an equal benefit to the 40...

Q:

An online option calculator provides the following Greeks information on 3 options. Please determine the best combination of 2 different call options for a moderately bearish strategy. Assume the...

Q:

Chapter 9 Hypothesis Tests for One Population 4 The value obtained for the teststatistic, z, in aone-mean z-test is given. Whether the test is twotailed, lefttailed, or right tailed is also...

Q:

8 . Assume the following inputs for parts a , b , and c below. The market portfolio has an expected return of 1 2 % and a standard deviation of returns of 2 0 % . The risk - free rate is 5 % . a )...