The basic problem portrayed by the traditional Phillips Curve is
A)that a level of aggregate demand sufficiently high to result in full employment may also cause inflation.
B)that changes in the composition of total labor demand tend to be deflationary.
C)that unemployment rises at the same time the general price level is rising.
D)the possibility that automation will increase the level of noncyclical unemployment.

Question

Quizplus · Accepted Answer

The traditional Phillips Curve illustrates an inverse relationship between unemployment and inflation, suggesting that achieving full employment may lead to higher inflation.

The Basic Problem Portrayed by the Traditional Phillips Curve Is