In 1980, the combination of inflation and unemployment the U.S. was experiencing
A)resulted from a leftward shift of the short-run Phillips curve.
B)was consistent with feasible inflation-unemployment combinations provided by the Phillips curve of the 1960s.
C)followed two supply shocks that were triggered by the Organization of Petroleum Exporting Countries.
D)resulted from expansionary monetary policy.

Question

Quizplus · Accepted Answer

The combination of inflation and unemployment the U.S. experienced in 1980, often referred to as stagflation, followed two major oil supply shocks in the 1970s triggered by the Organization of Petroleum Exporting Countries (OPEC). These shocks led to higher prices for oil, increasing production costs and contributing to both inflation and unemployment.

In 1980, the Combination of Inflation and Unemployment the U