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Principles of Macroeconomics Study Set 8
Exam 22: The Short Run Trade Off Between Inflation and Unemployment: Part B
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Question 21
True/False
If expected inflation increases,the short-run Phillips curve will shift to the left so that inflation will be higher at any given unemployment rate.
Question 22
True/False
Other things the same,a decrease in aggregate demand decreases both inflation and unemployment.
Question 23
True/False
According to the Phillips curve,policymakers can reduce both inflation and unemployment by increasing the money supply.
Question 24
True/False
Other things the same,if the Fed increases the rate at which it increases the money supply then the short-run Phillips curve shifts right in the long run.
Question 25
True/False
According to the Friedman-Phelps analysis,in the long run actual inflation equals expected inflation and unemployment is at its natural rate.
Question 26
True/False
The logic behind the tradeoff between inflation and unemployment is that high aggregate demand puts upward pressure on wages and prices while raising output.
Question 27
True/False
The sacrifice ratio of the Volcker disinflation was larger than previous estimates had predicted.
Question 28
True/False
A rightward shift of the short-run aggregate-supply curve results in a more favorable trade-off between inflation and unemployment.
Question 29
True/False
Just as the aggregate-supply curve slopes upward only in the short run,the trade-off between inflation and unemployment holds only in the short run.
Question 30
True/False
In a famous article published in 1958,A.W.Phillips used data for the United Kingdom to show a negative relationship between the rate of change of wages in the U.K.and the U.K.unemployment rate.