If the natural unemployment rate increases, then the short-run Phillips curve shifts ___________and the long-run Phillips curve shifts___________ .
A) leftward; leftward
B) rightward; leftward
C) rightward; rightward
D) leftward; rightward

Question

Quizplus · Accepted Answer

An increase in the natural unemployment rate shifts both the short-run and long-run Phillips curves to the right, indicating higher unemployment at each level of inflation.

If the Natural Unemployment Rate Increases, Then the Short-Run Phillips