While referring to the “EYE on YOUR LIFE” section on page
389 of the textbook, discuss the change in...

Question

While referring to the “EYE on YOUR LIFE” section on page
389 of the textbook, discuss the change in the U.S. unemployment rate and
inflation rate over the past year based on the Phillips curve concepts.
Did they change in the same direction or in opposite directions? Explain
if the change was a movement along a short-run Phillips curve or a shifting
short-run Phillips curve. Can you think of reasons why the short-run
Phillips curve might have shifted? Finally, based on these economic
concepts as well as your own point-of-view, discuss and explain what is worse
for our U.S. economy, too much inflation or too much unemployment?

David · Accepted Answer

While referring to the “EYE on YOUR LIFE” section on page 389 of the textbook, discuss the 
change in the U.S. unemployment rate and inflation rate over the past year based on the Phillips 
curve concepts. Did they change in the same direction or in opposite directions? Explain if the 
change was a movement along a short-run Phillips curve or a shifting short-run Phillips curve. 
Can you think of reasons why the short-run Phillips curve might have shifted? Finally, based on 
these economic concepts as well as your own point-of-view, discuss and explain what is worse 
for our U.S. economy, too much inflation or too much unemployment? 
Answer:

While referring to the “EYE on YOUR LIFE” section on page 389 of the textbook, discuss the change in the U.S. unemployment rate and inflation rate over the past year based on the Phillips curve...

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