A Phillips curve shows the relationship between
A)unemployment and inflation.
B)unemployment and real national income.
C)the interest rate and planned investment.
D)money demand and the rate of interest.

Question

Quizplus · Accepted Answer

A Phillips curve shows the relationship between unemployment and inflation. It suggests that when unemployment is high, inflation tends to be low, and vice versa. The curve was named after economist A.W. Phillips, who first observed this relationship in the UK labor market in the 1950s.

A Phillips Curve Shows the Relationship Between