Exam 12: U.S Inflation, Unemployment, and Business Cycle

The Phillips curve describes the relationship between real GDP and inflation.

According to real business cycle RBC) theory, a change in the quantity of money leads to

A Phillips curve measures the relationship between

A decrease in the expected inflation rate leads to__________in the long -run Phillips curve and__________ in the short-run Phillips curve.

According to the real business cycle theory, technological change

According to the new classical model, changes in aggregate demand change real GDP

One assumption of the new classical model is that

-The figure above shows the aggregate demand, short-run aggregate supply, and long-run aggregate supply curves for the U.S. economy. The economy is currently at point A. A cost-push rise in the price level will initially move the economy to point ___________and to point___________ .

Which of the following could lead to demand-pull inflation?

Demand pull inflation can be started by

-In the above figure, which path represents a demand-pull inflation?

In the short run, an unexpected increase in the inflation rate leads to

Which of the following is the factor the creates business cycles in the real business cycle theory?

A larger than expected increase in aggregate demand will lead to __________in the __________of the business cycle.

Cost-push inflation can be started by

The short-run Phillips curve shows the tradeoff between , holding the expected inflation rate and the natural unemployment rate constant.

Suppose the expected inflation rate is 12 percent and the unemployment rate is 5 percent. If the expected inflation rate increases to 13 percent,

The short-run Phillips curve and the long-run Phillips curve intersect at the___________ and___________

Demand-pull inflation starts with

If the prices of crucial raw materials increase,