Answer the following: (6 marks)

1. If wages are sticky in the short-run, the short-run Phillips curve is downward sloping. TRUE / FALSE
2. A downward sloping Philips curve implies that output increases as inflation rises. TRUE / FALSE
3. An increase in worker productivity brought about by the introduction of new technology decrease aggregate demand, since workers will lose their jobs. TRUE / FALSE
4. A decrease in expected inflation both the short-run and the long-run Phillips curves to the left. TRUE / FALSE
5. The long-run Phillips curve will be upward sloping if persistent high inflation discourages investment in technological improvement TRUE / FALSE
6. Since the short-run Philips curve is downward sloping and the long-run Phillips curve is vertical there can never be simultaneous unemployment inflation TRUE / FALSE