HomeworkLib
Question

How would you explain the Phillip curve / what does one to have in mind when...

How would you explain the Phillip curve / what does one to have in mind when drawing the Phillip curve?

Do we need to first understand the relationship between unemployment and inflation?

business   economics   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Philip curves shows the relationship between unemployment and inflation.We need to understand the relationship between unemployment and inflation first to understand the Phillip curve.The relation is inverse,which means a rise in inflation reduces unemployment,or a rise in unemployment reduces inflation.

High inflation->High femand for workers->High employment

Low inflation->lower demand for labour->High employment.

Phillip curve gives this inverse relationship between inflation and unemployment in the short run.In the long run,there is no tradeoff between inflation and unemployment.

0 0
Add a comment
Know the answer?
Add Answer to:
How would you explain the Phillip curve / what does one to have in mind when...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • move at the same rate). Specify what you set aside on the shoulders; name all graphs and explain how you thought when d...

    move at the same rate). Specify what you set aside on the shoulders; name all graphs and explain how you thought when doing the graphs. (3p) 2. The public in the country has adaptive expectations. Now suppose the actual and the expected inflation are both eight percent and have been so for a long time. Explain what happens if inflation for any reason suddenly would increase permanently from eight to twelve percent (one-time increase equivalent to four percentage points). What...

  • a. What does it mean when two physical quantities are directly proportional? How would you represent...

    a. What does it mean when two physical quantities are directly proportional? How would you represent one as a graph? As a function? Give a physics-based example of such a directly proportional relationship. b. What does it mean when two physical quantities have a linear relationship? How would you represent one as a graph? As a function? Explain the difference between a linear relationship and a directly proportional relationship. Include a physics-based example of a linear relationship. c. What is...

  • Discuss the following statements: a . The Phillips curve implies that when unemployment is high, inflation...

    Discuss the following statements: a . The Phillips curve implies that when unemployment is high, inflation is low, and vice versa . Therefore, we may experience either high inflation or high unemployment, but we will never experience both together. b. As long as we do not mind having high inflation, we can achieve as low a level of unemployment as we want. All we have to do is increase the demand for goods and services by using, for example, expansionary...

  • What might cause the Aggregate Demand curve to shift to the right? What does this mean...

    What might cause the Aggregate Demand curve to shift to the right? What does this mean for the state of the economy? What might cause the Aggregate Demand curve to shift to the left? What does this mean for the state of the economy? Sometimes the Aggregate Supply curve is drawn as an upward sloping straight line--other times it is drawn initially flat, then upsloping, then very steep. How does the shape of the AS curve matter for the effect...

  • PHILOSOPHY: 1. What is the mind-body problem? a.) Why does my body not do what my...

    PHILOSOPHY: 1. What is the mind-body problem? a.) Why does my body not do what my mind tells it to? b.) How does the mind relate to the body? c.) How can there be thoughts and no souls? d.) How can it be 'mind over matter' in certain contexts? The mind-body problem is a very, very, old puzzle in philosophy. It is trying to explain how our 'what-it's-likenesses' relate to our bodily states. It's trying to explain how our thoughts,...

  • Consider the following Philips Curve. ? = Eπ − 0.6 (?−0.05) A) Interpret the Philips Curve....

    Consider the following Philips Curve. ? = Eπ − 0.6 (?−0.05) A) Interpret the Philips Curve. ( 5 points) B) Assume that Eπ=0.02. Draw the graph of the Philips Curve and call it Figure 1. What is the slope of the Graph? What are the long-run unemployment rate and the long-run inflation rate? ( 5 points) C) Is there any possibility that a government can decrease the inflation rate without any change in the unemployment rate? If yes, how? Explain...

  • How are unemployment and inflation related to one another? When unemployment is below the natural rate...

    How are unemployment and inflation related to one another? When unemployment is below the natural rate of unemployment, the inflation rate is likely to fall. When unemployment is at the natural rate of unemployment, the inflation rate is likely to rise. When unemployment is above the natural rate of unemployment, the inflation rate is likely to remain unchanged. When unemployment is below the natural rate of unemployment, the inflation rate is likely to rise. There is no relationship between the...

  • Question 21 (1 point) When prices are falling, what term do economists use? inflation deflation disinflation...

    Question 21 (1 point) When prices are falling, what term do economists use? inflation deflation disinflation contraction Question 22 (1 point) What does the quantity theory of money try to explain? O the relationship between inflation and unemployment the determinants of relative prices in the economy ООО the relationship between the quantity of money and the price level how inflation determines economic growth

  • One thing that you have to keep in mind about user interface is you must Know...

    One thing that you have to keep in mind about user interface is you must Know Your User or Client and Understand the Business Function. Write at least one paragraph for each question and remember each paragraph must contain three or more sentences. Why is it important to Know Your Client and explain why. Additionally why is imperative to Understand the Business Function. How does this ide apply to designing an interface. How will you use it in your Project...

  • How do you make a standard curve? What does a good standard curve look like? How...

    How do you make a standard curve? What does a good standard curve look like? How can you use a standard curve? (four sentences or less – remember that pictures are almost always easier to understand then a paragraph of text).

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT