Which of the following is false? a. The short-run effect of unexpected disinflation is rising unemployment.
Question:
Which of the following is false?
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a. The short-run effect of unexpected disinflation is rising unemployment.
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b. The short-run Phillips curve assumes a constant reservation wage and a constant expected rate of inflation.
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c. The tradeoff between inflation and unemployment comes from expected inflation.
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d. Inventory fluctuations may cause a movement along the Phillips curve.
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e. If wages were flexible, unexpected changes in aggregate demand might be reflected more in wage adjustments than in employment adjustments.
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