The Phillips curve is often used to show the relationship between
A)GDP and unemployment in a given year
B)the rates of inflation and unemployment over time
C)employment and GDP
D)changes in GDP and the rate of inflation
E)unemployment and GDP growth

Question

Quizplus · Accepted Answer

The Phillips curve is used to show the relationship between the rates of inflation and unemployment over time. It suggests that there is an inverse relationship between the two, meaning that when unemployment is low, inflation tends to be high, and when unemployment is high, inflation tends to be low. This relationship has been observed in many countries over several decades, although its strength and reliability have been subject to debate among economists.

The Phillips Curve Is Often Used to Show the Relationship