FRED work:Is Phillips Curve dead or is it alive and well?

Use FRED Database: https://fred.stlouisfed.org

Towards the end of our Week 6 class, we discussed the Phillips curve, which theorizes a negative relationship between unemployment rates and inflation. That is, as unemployment rises, inflation falls, and vice versa, of course.Debate among economists continues, though, as to whether this relationship does in fact hold.Your task is to decide for yourself using FRED!How?Read on.

First, graph thequarterlycivilian unemployment rate, U3 (FRED code:UNRATE), from the beginning of the series through Q1 2021.(By default, of course, the axis labels will appear on the left side.)Then, using "Add Line," plot thepercent-change-from-a-year-agoseriesof the consumer price index (FRED code:CPIAUCSL), placing this series's axis label on the right-hand side, using the "Format " command, as you've done in the past. (Remember, you must first change the CPIAUCSL series units to "percent change from a year ago."Make sure the CPIAUCSL series is also quarterly.)

(i)Attach Graph

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(ii)So who's right?Are the experiences of the 1950s, which were the inspiration for the idea of the original Phillips curve, similar to those of the following decades?Or is the Phillips curve dead?Explain your answer referring to your graph! (Note:you might change the CPI units to "compounded annual rate of change" to see what happens.)

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(iii)Is the Great Recession consistent with the Phillips curve?Why or why not?And the Great Pandemic Recessionto date?Explain.

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(iv)What are the Q1 2021 values for U3 and the CPI as shown in your graph?(Round the shown percentages to 2 decimal places.)

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