To move to a point on the Phillips curve where inflation islower, unemployment must rise and the unemployment rise could havebeen caused by the Fed decreasing the money supply.
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True
False
According to the natural rate hypothesis (Friedman and Phelps),policymakers face a long-run Philips curve that is vertical becausethe natural unemployment rate is independent of the inflationrate.
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True
False
The federal government could increase spending and decreasetaxes to move to a point on the short-run Phillips curve whereinflation is lower, but unemployment would rise.
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True
False
The short-run Phillips curve shows the combinations ofunemployment and inflation that arise in the short run as short-runaggregate supply shifts the economy along the aggregate demandcurve.
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True
False
In the mid and late 1990s, aggregate supply shifted to the rightand the Phillips curve shifted to the left as inflationexpectations changed to a lower rate.
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True
False
