In 1968, economist Milton Friedman published a paper criticizing the Phillips curve on the grounds thatO a. it seemed to work for wages but not for inflation.b. Phillips had made errors in collecting his data.O c. monetary policy was ineffective in combating inflation.d. the Phillips curve did not apply in the long run.

An economic concept that describes the relationship between inflation (π) and unemployment (U) in an…

In 1968, economist Milton Friedman published a paper criticizing the Phillips curve on the grounds that O a. it seemed to work for wages but not for inflation. O b. Phillips had made errors in collecting his data. O c. monetary policy was ineffective in combating inflation. O d. the Phillips curve did not apply in the long run.

In 1968, economist Milton Friedman published a paper criticizing the Phillips curve on the grounds that O a. it seemed to work for wages but not for inflation. O b. Phillips had made errors in collecting his data. O c. monetary policy was ineffective in combating inflation. O d. the Phillips curve did not apply in the long run.

Principles of Macroeconomics (MindTap Course List)

7th Edition

ISBN:9781285165912

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter22: The Short-Run Trade-off Between Inflation And Unemployment

Section: Chapter Questions

Problem 3QCMC

See similar textbooks

Similar questions

What is true along the long-run Phillips curve? A. A labor shortage exists. B. A tradeoff exists between the inflation rate and the unemployment rate. C. The economy is at full employment. D. The inflation rate equals the expected inflation rate and any unemployment rate is possible. th aht thanks
A politician blames the Federal Reserve for being "soft on unemployment" and claims that a permanently higher money supply growth rate will lead to a permanent reduction in the unemployment rate. The politician's argument is a. consistent with the long-run Phillips curve. Further, the long-run Phillips curve implies that such a policy would not increase inflation. b. inconsistent with the long-run Phillips curve. Further, the long-run Phillips curve implies that such a policy would increase inflation. c. inconsistent with the long-run Phillips curve. However, the long-run Phillips curve implies that such a policy would not increase inflation. d. consistent with the long-run Phillips curve. However, the long-run Phillips curve implies that such a policy would increase inflation.
There are economists talking about the Phillips curve is a failure to predict the economy during the current pandemic . Which of the following statement about the Phillips curve is correct. O Phillips curve simply outlines the observation of a negative relationship between inflation and unemployment in data. The central banks should always design their policies according to the Phillips curve. Phillips curve predicts that high inflation leads to low unemployment rate. Phillips curve predicts that high unemployment rate cause low inflation.
The accompanying graph depicts the Short-Run Phillips O Curve (SRPC) when the public expects no inflation in the economy. Macmillan Learning a. According to this SRPC, what would inflation be if unemployment is 9%? 0 Incorrect b. Please move the SRPC line to reflect what would happen if the public's inflation expectations increased so that they now expect the inflation rate to increase by 2%. c. If the unemployment rate is still 9%, what is the new inflation rate after this change in expectations? % 2 % Inflation rate (%) 7 6 5 4 3 2 1 0 -1 -2 -3 0 1 SRPC 2 3 4 5 6 Unemployment rate (%) 7 8 9 10
If a central bank had to give up its discretion and follow a rule that required it to keep inflation low, a. the short-run Phillips curve would shift up. b. the short-run Phillips curve would shift down. c. the long-run Phillips curve would shift right. d. the long-run Phillips curve would shift left.
What is true along the long-run Phillips curve? A. A labor shortage exists. B. A tradeoff exists between the inflation rate and the unemployment rate. C. The economy is at full employment. D. The inflation rate equals the expected inflation rate and any unemployment rate is possible.
According to the short-run Phillips curve, if the central bank increases the money supply then O inflation and unemployment swill both rise O'inflation will fall and unempiloyment will rise O inflation and unemployment will both fall inflation will rise and unempiloyment will fall
How does the money wage rate change along the Phillips curves? Along the short-run Phillips curve, the money wage rate _______, and along the long-run Phillips curve, the money wage rate _______. A. rises by the same percentage as the inflation rate; rises by the same percentage as the inflation rate B. is constant; is constant C. rises by the same percentage as the inflation rate; is constant D. is constant; rises by the same percentage as the inflation rate
How does the money wage rate change along the Phillips curves? Along the short-run Phillips curve, the money wage rate _______, and along the long-run Phillips curve, the money wage rate _______. A. rises by the same percentage as the inflation rate; rises by the same percentage as the inflation rate B. is constant; is constant C. rises by the same percentage as the inflation rate; is constant D. is constant; rises by the same percentage as the inflation rate s thank s screenshot atttached
Suppose the long-run Phillips curve shifts to the right. For any given rate of money growth and inflation, how would unemployment and output change? a. Unemployment would be higher, and output would be lower. b. Unemployment would be higher, and output would be higher. c. Unemployment would be lower, and output would be lower. d. Unemployment would be lower, and output would be higher.
Suppose that an economy has the Phillips curve π = π−1 − 0.5( u − 0.06). a. What is the natural rate of unemployment? b. Graph the short-run and long-run relationships between inflation and unemployment. c. How much cyclical unemployment is necessary to reduce inflation by 5 percentage points? Using Okun’s law, compute the sacrifice ratio. d. Inflation is running at 10 percent. The Fed wants to reduce it to 5 percent. Give two scenarios that will achieve that goal.
What is the effect of an increase in aggregate demand on the short-run Phillips curve? When aggregate demand increases, _______. A. the short-run Phillips curve shifts upward B. the short-run Phillips curve shifts downward C. a movement occurs upward along the short-run Phillips curve D. a movement occurs downward along the short-run Phillips curve