According to the Phillips curve, unemployment and inflation are positively related in
A)the short run and in the long run.
B)the short run, but not in the long run.
C)the long run, but not in the short run.
D)neither the long run nor the short run.

Question

Quizplus · Accepted Answer

The Phillips curve suggests an inverse relationship between unemployment and inflation in the short run, meaning they are negatively related. In the long run, the relationship is typically considered to be neutral, as expectations adjust and the economy returns to the natural rate of unemployment.

According to the Phillips Curve, Unemployment and Inflation Are Positively