An increase in the expected inflation rate shifts the
A)short- run Phillips curve downward.
B)long- run Phillips curve downward.
C)short- run Phillips curve upward.
D)long- run Phillips curve upward.

Question

Quizplus · Accepted Answer

An increase in the expected inflation rate shifts the short-run Phillips curve upward because higher expected inflation leads to higher actual inflation at any given level of unemployment.

An Increase in the Expected Inflation Rate Shifts the