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Vsevolod [243]
3 years ago
13

A short-run phillips curve shows an inverse relationship between

Business
1 answer:
photoshop1234 [79]3 years ago
6 0

Answer: unemployment rate and the inflation rate.

Explanation:

The Phillips curve shows the relationship that exists between inflation and unemployment rates. The short-run Phillips curve looks like an L-shape and it reflects the inverse relationship between the two variables i.e unemployment and inflation.

As unemployment rates rises, inflation reduces and as unemployment rates reduces, inflation increases. A reduction in the aggregate supply will lead to a rightward shift the short run Phillips Curve.

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Answer:

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