Week 7 Lecture 3 Flashcards by Raunaq Mohammad

Q

What does the Phillips curve show?

A

The Phillips curve shows the short-run trade-off between inflation and unemployment
It shows that there is a negative correlation between unemployment and the rate of inflation

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Q

What goes on each axis of a Phillips curve?

A

Inflation rate goes on the y-axis
Unemployment goes on the x-axis

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Q

A

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