The Phillips Curve shows the inverse relationship between unemployment rate and inflation rate. It suggests that as unemployment decreases, inflation tends to increase (and vice versa).
Stagflation: A situation where an economy experiences both high inflation and high unemployment simultaneously.
Natural Rate of Unemployment: The level of unemployment that exists when an economy is operating at its potential output.
Demand-Pull Inflation: A type of inflation caused by excessive aggregate demand in relation to available supply.
AP Macroeconomics - 5.2 The Phillips Curve
AP Macroeconomics - 2024 AP Macroeconomics Exam Guide
AP Macroeconomics - Unit 5 Overview: Long-Run Consequences of Stabilization Policies
Which of the following is a component of the Phillips Curve relationship?
In the short run, what trade-off does the Phillips curve reflect?
What is the long-run equilibrium point on the Phillips curve?
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