Consider the following Phillips curve diagram: For the case where the economy is at Point A, Point B, or Point C, explain:
(a) whether actual inflation is above or below expected inflation (What is each exactly?)
(b) the likely shift in the short-run Phillips curve
(c) the likely change in unemployment

Question

Consider the following Phillips curve diagram:  For the case where the economy is at Point A, Point B, or Point C, explain:
(a) whether actual inflation is above or below expected inflation (What is each exactly?)
(b) the likely shift in the short-run Phillips curve
(c) the likely change in unemployment

Quizplus · Accepted Answer

The Answer of Consider the following Phillips curve diagram:  For the case where the economy is at Point A, Point B, or Point C, explain:
(a) whether actual inflation is above or below expected inflation (What is each exactly?)
(b) the likely shift in the short-run Phillips curve
(c) the likely change in unemployment

Consider the Following Phillips Curve Diagram: for the Case