Question : 11) The tradeoff exhibited by the short-run Phillips curve is A) : 1227988

11) The tradeoff exhibited by the short-run Phillips curve is

A) higher inflation with higher unemployment.

B) lower inflation with lower unemployment.

C) higher unemployment with lower inflation.

D) changing inflation with constant unemployment.

E) higher price level with lower real GDP.

12) Moving along the short-run Phillips curve, if ________ increases then ________ decreases.

A) inflation; unemployment

B) inflation; the price level

C) inflation; real GDP

D) unemployment; the price level

E) unemployment; the expected inflation rate

13) Moving along the short-run Phillips curve, a ________ unemployment rate can only be achieved by paying the cost of ________.

A) lower; a higher inflation rate

B) lower; a lower inflation rate

C) lower; a higher expected inflation rate

D) lower; a lower price level

E) higher; a higher inflation rate

14) During a recession, there is a ________ the short-run Phillips curve, while during an expansion there is a ________ the short-run Phillips curve.

A) movement closer to; movement further from

B) downward movement along; upward movement along

C) upward movement along; downward movement along

D) rightward shift of; leftward shift of

E) leftward shift of; rightward shift of

15) The curve shown in the figure above is the

A) aggregate demand curve.

B) aggregate supply curve.

C) demand for money curve.

D) Phillips curve.

E) potential GDP curve.

16) The short-run Phillips curve presents a tradeoff because a

A) higher unemployment rate can be achieved at the cost of a higher inflation rate.

B) lower unemployment rate can be achieved at the cost of a lower inflation rate.

C) lower unemployment rate can be achieved at the cost of a higher inflation rate.

D) higher inflation leads to a higher nominal interest rate.

E) higher price level leads to a lower real GDP.

17) Along a short-run Phillips curve, the

A) short-run cost of lower unemployment is higher inflation.

B) short-run benefit of lower unemployment is lower inflation.

C) short-run cost of lower inflation is higher interest rates.

D)  long-run cost of lower inflation is higher unemployment.

E) short-run cost of higher inflation is a higher real interest rate.

18) The short-run Phillips curve is another way of looking at

A) aggregate demand.

B) aggregate supply.

C) the natural rate of unemployment.

D) Okun’s law as applied to aggregate demand.

E) potential GDP.

19) Comparing the aggregate supply curve and the short-run Phillips curve, we see that they

A) each describe different parts of the economy.

B) both exist since money wages are flexible.

C) describe the same phenomena but contradict each other.

D) both exist because money wage rate is fixed in the short run.

E) both exist because real wage rate is fixed in the short run.

20) ________ is fixed when moving along the aggregate supply curve.

A) The money wage rate

B) The real wage rate

C) Employment

D) Real GDP

E) The price level