The short-run Phillips curve shows the combinations of
A)unemployment and inflation that arise in the short run as aggregate demand shifts the economy along the short-run aggregate supply curve.
B)unemployment and inflation that arise in the short run as short-run aggregate supply shifts the economy along the aggregate demand curve.
C)real GDP and the price level that arise in the short run as short-run aggregate supply shifts the economy along the aggregate demand curve.
D)real GDP and the price level that arise in the short run as aggregate demand shifts the economy along the short-run aggregate supply curve.

Question

Quizplus · Accepted Answer

The short-run Phillips curve illustrates the trade-off between unemployment and inflation that occurs in the short run as shifts in aggregate demand move the economy along the short-run aggregate supply curve. This reflects the inverse relationship between unemployment and inflation in the short term.

The Short-Run Phillips Curve Shows the Combinations of