The Phillips Curve suggests a tradeoff between:
A)price level stability and income equality.
B)the level of unemployment and price level stability.
C)unemployment and income equality.
D)economic growth and full employment.

Question

Quizplus · Accepted Answer

The Phillips Curve suggests a tradeoff between the level of unemployment and price level stability. As unemployment decreases, wages increase, leading to increased demand and higher prices. Conversely, as unemployment increases, wages decrease, leading to reduced demand and lower prices. Therefore, there is an inverse relationship between unemployment and inflation, as shown by the Phillips Curve.

The Phillips Curve Suggests a Tradeoff Between