A. Draw a correctly labeled graph of the short run Phillips Curve for Country Y. Show the actual unemployment and inflation rate for both years. Label the Phillips Curve as SRPC. B. Now, the short run aggregate supply curve has shifted left. i. Identify one cause that would shift short run aggregate supply to the left. ii. On your graph in Part A, show how this shift would impact the short run Phillips Curve.

A. Draw a correctly labeled graph of the short run Phillips Curve for Country Y. Show the actual unemployment and inflation rate for both years. Label the Phillips Curve as SRPC. B. Now, the short run aggregate supply curve has shifted left. i. Identify one cause that would shift short run aggregate supply to the left. ii. On your graph in Part A, show how this shift would impact the short run Phillips Curve.

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

The table below shows unemployment and inflation data in Country Y after a shift in
aggregate demand.
Period
2021
2022
Unemployment Rate
2%
5%
Inflation Rate
8%
4%
A. Draw a correctly labeled graph of the short run Phillips Curve for Country Y. Show
the actual unemployment and inflation rate for both years. Label the Phillips Curve as
SRPC.
B. Now, the short run aggregate supply curve has shifted left.
i. Identify one cause that would shift short run aggregate supply to the left.
ii. On your graph in Part A, show how this shift would impact the short run Phillips
Curve.

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