Economists who have studied the Phillips curve have concluded that it can shift due to all of the following EXCEPT
A) demand shocks.
B) supply shocks.
C) changes in household expectations of inflation.
D) changes in firms' expectations of inflation.

Question

Quizplus · Accepted Answer

The Phillips curve, which illustrates the inverse relationship between unemployment and inflation, can shift due to various factors such as supply shocks, changes in household expectations of inflation, and changes in firms' expectations of inflation. However, demand shocks affect the movement along the Phillips curve rather than causing the curve itself to shift.

Economists Who Have Studied the Phillips Curve Have Concluded That