The Phillips curve explains the trade-off between inflation and unemployment.

Name: The Phillips curve explains the trade-off between inflation and unemployment.
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The Phillips curve depicts the inverse relationship between unemployment and inflation. The theory suggests that as unemployment decreases, inflationary pressures increase and vice versa. However, the relationship may not hold in the long run as there may be supply-side factors at play that affect both unemployment and inflation.

The Phillips Curve Explains the Trade-Off Between Inflation and Unemployment