The short-run Phillips curve is ________ curve along which an increase in the unemployment rate is associated with ________ in the inflation rate.
A) an upward-sloping; an increase
B) a vertical; no change
C) a downward-sloping; no change
D) a downward-sloping; a decrease
E) a horizontal; no change

Question

Quizplus · Accepted Answer

The short-run Phillips curve is a downward-sloping curve, indicating that an increase in the unemployment rate is associated with a decrease in the inflation rate. This relationship suggests that there is a trade-off between inflation and unemployment in the short run.

The Short-Run Phillips Curve Is ________ Curve Along Which an Increase