The baby boomers born in the 1940s and 1950s began entering the work force in the 1960s and 1970s.This demographic event ________ the natural unemployment rate,thereby shifting the short-run Phillips curve ________ and shifting the long-run Phillips curve ________.

Question

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The entry of baby boomers into the work force increased the labor force, increasing the natural rate of unemployment. This means the short-run Phillips curve shifted rightward, indicating that higher inflation rates would be necessary to achieve lower unemployment rates. The long-run Phillips curve also shifted rightward, indicating that the trade-off between inflation and unemployment became less favorable in the long run.

The Baby Boomers Born in the 1940s and 1950s Began