The Phillips curve shifted during the 1970s primarily because of
A)the two large oil price shocks.
B)the changing demographics of the population.
C)tight monetary policy.
D)easy fiscal policy.

Question

Quizplus · Accepted Answer

The Phillips curve shifted during the 1970s primarily because of the two large oil price shocks. These shocks led to a combination of higher inflation and higher unemployment, contradicting the traditional Phillips curve relationship between inflation and unemployment.

The Phillips Curve Shifted During the 1970s Primarily Because of