Suppose that for years East Confettis short-run Phillips Curve was such that each 1 percentage point increase

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Suppose that for years East Confetti’s short-run Phillips Curve was such that each 1 percentage point increase in its unemployment rate was associated with a 2 percentage point decline in its inflation rate. Then, during several recent years, the short-run pattern changed such that its inflation rate rose by 3 percentage points for every 1 percentage point drop in its unemployment rate. Graphically, did East Confetti’s Phillips Curve shift upward or did it shift downward? LO3

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Economics Principles Problems And Policies

ISBN: 9780073511443

19th Edition

Authors: Campbell Mcconnell ,Stanley Brue ,Sean Flynn

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