Which of the following leads to an rightward shift in the short-run Phillips curve?
I. a reduction in the expected inflation rate
II. an increase in the natural unemployment rate
A) II only
B) neither I nor II
C) I only
D) I and II

Question

Quizplus · Accepted Answer

An increase in the natural unemployment rate leads to a rightward shift in the short-run Phillips curve, as it reflects a higher baseline level of unemployment at any given inflation rate.

Which of the Following Leads to an Rightward Shift in the Short-Run