According to the Phillips curve, a more expansionary macro-policy that causes inflation to be greater will:
A) place downward pressure on prices.
B) reduce unemployment.
C) reduce output.
D) reduce the natural rate of unemployment.

Question

Quizplus · Accepted Answer

According to the Phillips curve, there is an inverse relationship between inflation and unemployment. Therefore, a more expansionary macro-policy that causes inflation to be greater will reduce unemployment.

According to the Phillips Curve, a More Expansionary Macro-Policy That