An increase in expected inflation will shift the short-run Phillips Curve.

Name: An increase in expected inflation will shift the short-run Phillips Curve.
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Question

Quizplus · Accepted Answer

According to the Phillips Curve theory, there is a negative relationship between unemployment and inflation in the short run. An increase in expected inflation would shift the Phillips Curve upward, implying that at any given level of unemployment, the expected inflation rate is higher, and vice versa. Therefore, the correct answer is A.

An Increase in Expected Inflation Will Shift the Short-Run Phillips