Along the short-run Phillips curve, the
A) actual inflation rate is equal to the expected inflation rate.
B) expected inflation rate is constant.
C) observed unemployment rate is equal to the natural rate of unemployment.
D) real wage rate is zero.
E) nominal wage rate is constant.

Question

Quizplus · Accepted Answer

The short-run Phillips curve assumes that the expected inflation rate is constant while illustrating the inverse relationship between the rate of inflation and the unemployment rate.

Along the Short-Run Phillips Curve, the