-Exhibit 16.5 shows a Phillips curve. Combinations of inflation and unemployment that are attainable as long as the curve itself does not shift are represented by _____
A) point a.
B) point b.
C) point c.
D) points a and b.
E) points c and d.

Question

-Exhibit 16.5 shows a Phillips curve. Combinations of inflation and unemployment that are attainable as long as the curve itself does not shift are represented by _____
A) point a. 
B) point b. 
C) point c. 
D) points a and b. 
E) points c and d.

Quizplus · Accepted Answer

The Phillips curve illustrates the trade-off between inflation and unemployment in an economy, suggesting that lower unemployment comes with higher inflation and vice versa, as long as the curve itself does not shift. Points a and b, being on the curve, represent attainable combinations of inflation and unemployment without the curve shifting.