Eurozone Unemployment Hits Record High As Inflation Rises Unexpectedly Eurozone unemployment rose to 10.7 percent.

At the same time, eurozone inflation unexpectedly rose to 2.7 percent a year, up from the previous month’s 2.6 percent a year.

Source: Huffington Post, March 1, 2012

a. How does the Phillips curve model account for a very high unemployment rate?

b. Explain the change in unemployment and inflation in the eurozone in terms of what is happening to the short-run and long-run Phillips curves.