The short-run Phillips curve is
A) downward sloping.
B) upward sloping.
C) vertical at a constant rate of unemployment.
D) horizontal at a constant rate of inflation.
E) U-shaped.

Question

Quizplus · Accepted Answer

The short-run Phillips curve is downward sloping, meaning that there is an inverse relationship between inflation and unemployment in the short run. As unemployment decreases, inflation increases, and vice versa. The curve can shift due to changes in supply or demand factors, but in the short run, it is generally downward sloping.

The Short-Run Phillips Curve Is