Question : 15.4   Chapter Figures The figure above shows some Phillips curves for : 1240605

 

15.4   Chapter Figures

 

 

 

The figure above shows some Phillips curves for an economy.

 

1) The short-run Phillips curve shifts from SRPC0 to SRPC1 as a result of

A) an increase in the natural unemployment rate.

B) a decrease in the natural unemployment rate.

C) a rise in the expected inflation rate.

D) a fall in the expected inflation rate.

E) None of the above answers is correct.

2) Along the short-run Phillips curve SRPC0 the expected inflation rate is

A) 3 percent.

B) 6 percent.

C) 7 percent.

D) an amount that can be determined from the figure, but none of the above answers is correct.

E) an amount that cannot be determined from the figure.

 

3) Along the short-run Phillips curve SRPC0 the natural unemployment rate is

A) 3 percent.

B) 6 percent.

C) 7 percent.

D) an amount that can be determined from the figure, but none of the above answers is correct.

E) an amount that cannot be determined from the figure.

 

The figure above shows some Phillips curves for an economy.

 

4) Along the short-run Phillips curve SRPC0 the natural unemployment rate is

A) 3 percent.

B) 6 percent.

C) 4 percent.

D) 8 percent.

E) an amount that can be determined from the figure but none of the above answers is correct.

 

5) Along the short-run Phillips curve SRPC2 the natural unemployment rate is

A) 3 percent.

B) 6 percent.

C) 4 percent.

D) 8 percent.

E) an amount that can be determined from the figure but none of the above answers is correct.

6) In the figure above, the shift from the short-run Phillips curve SRPC0 and the long-run Phillips curve LRPC0 to the short-run Phillips curve SRPC1 and the long-run Phillips curve LRPC1 is the result of ________ in the expected inflation rate and ________ in the natural unemployment rate.

A) an increase; an increase

B) a decrease; a decrease

C) no change; an increase

D) an increase; no change

E) a decrease; no change

 

7) In the figure above, the shift from the short-run Phillips curve SRPC0 and the long-run Phillips curve LRPC0 to the short-run Phillips curve SRPC2 and the long-run Phillips curve LRPC2 is the result of ________ in the expected inflation rate and ________ in the natural unemployment rate.

A) an increase; an increase

B) a decrease; a decrease

C) no change; a decrease

D) an increase; no change

E) a decrease; an increase

 

15.5   Integrative Questions

 

1) Moving along a short-run Phillips curve, a reduction in the unemployment rate is achieved by

A) shifting the aggregate supply curve leftward.

B) running a federal budget deficit.

C) reducing the size of the labor force.

D) increasing the inflation rate.

E) increasing potential GDP.

2) Along a short-run Phillips curve when the inflation rate rises,

A) the real wage rate falls and more labor is hired.

B) the money wage rate falls because the labor market becomes less tight.

C) potential GDP decreases.

D) the expected inflation rate rises.

E) the expected inflation rate falls.

 

3) The long-run Phillips curve shows the relationship between the ________ and the ________ when there is no ________ unemployment.

A) inflation rate; unemployment rate; cyclical

B) inflation rate; unemployment rate; structural

C) inflation rate; employment rate; seasonal

D) nominal interest rate; real interest rate; frictional

E) nominal interest rate; unemployment rate; cyclical

 

4) The long-run Phillips curve represents the relationship between the inflation rate and the unemployment rate when there is no ________ unemployment.

A) cyclical

B) structural

C) seasonal

D) frictional

E) natural

5) In 1981 Fed policy created a severe recession because the Fed

A) increased aggregate supply to reduce the inflation rate.

B) undertook an unexpected reduction in the inflation rate.

C) publicly announced an inflation reduction program.

D) undertook an unexpected increase in the inflation rate.

E) publicly announced an inflation increase program.