Moving along the short- run Phillips curve indicates
A) a natural rate of unemployment that does not vary with inflation.
B) that higher unemployment leads to a higher inflation rate.
C) that higher inflation leads to a higher unemployment rate.
D) a tradeoff between inflation and unemployment so that higher inflation is related to lower unemployment.

Question

Quizplus · Accepted Answer

Moving along the short-run Phillips curve demonstrates the tradeoff between inflation and unemployment, where typically, higher inflation is associated with lower unemployment and vice versa.

Moving Along the Short- Run Phillips Curve Indicates