Please explain what does this assumption means , the graph and its paragraph, thanks a lot!

Assumption 1: The price level is expected to remain unchanged in an economy with a stable price level, wage setters may expect the price level to remain constant. In this case, expected ination is zero and the Phillips curve is simply Jr=f'+z. As we saw in Chapter 8, expansionary monetary policy can raise production and employment in the short run, but the Phillips curve tells us that there is a cost in terms of higher ination. From a policy perspective, this Phillips curve represents a trade-of between ination and unemployment, as illustrated in Fig. 9.4. One may argue that raising employment is more important than keeping low ination, so it is reasonable to accept some ination in order to keep employ- ment on a high level. Thus we may prefer to raise production to 1', although this increases ination to :r, . There is a problem with this reasoning, however. it is likely that wage setters form their expectations about future ination by looking at what the inflation rate has been in the past. if the central bank keeps production above the natu- ral level, wage setters will, sooner or later, discover that prices increase in every period. Then they will no longer expect zero ination, so the Phillips curve will shift upwards. Therefore, the situation with production above the natural level is not a long-run equilibrium. Fig. 9.4 The Phillips curve when prices are expected to remain constant If