The following graph plots a short-run Phillips curve for a hypothetical economy. Show the short-run effect of a contractionary monetary policy by dragging the point along the short-run Phillips curve (SRPC) or shifting the curve to the appropriate position. Now, show the long-run effect of a contractionary monetary policy by dragging either the short-run Phillips curve (SRPC), the long-run Phillips curve (LRPC), or both. As anticipated, inflation (rises/falls) and the short-run Phillips curve shifts (downward/upward) , highlighting the cost of fighting inflation, which is (higher unemployment in the long run/temporary unemployment/lower unemployment) . Which of the following examples
The following graph plots a short-run Phillips curve for a hypothetical economy.
Show the short-run effect of a contractionary
Now, show the long-run effect of a contractionary monetary policy by dragging either the short-run Phillips curve (SRPC), the long-run Phillips curve (LRPC), or both.
As anticipated, inflation (rises/falls) and the short-run Phillips curve shifts (downward/upward) , highlighting the cost of fighting inflation, which is (higher
Which of the following examples represents a cost of inflation? Check all that apply.
![Show the short-run effect of a contractionary monetary policy by dragging the point along the short-run Phillips curve (SRPC) or shifting the curve to
the appropriate position.
INFLATION RATE (Percent)
12
11
10
9
8
5
4
3
2
1
0
0
1
2
4
UNEMPLOYMENT (Percent)
SRPC
3
5
6
SRPC
?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6cd821eb-6ff2-4dd2-a82f-3a0e5436c8d8%2Ff066425d-5219-4e89-a7f0-fe9916fd1dc0%2F21jqez8_processed.png&w=3840&q=75)
![Now, show the long-run effect of a contractionary monetary policy by dragging either the short-run Phillips curve (SRPC), the long-run Phillips curve
(LRPC), or both.
INFLATION RATE (Percent)
12
11
10
9
∞
4
3
2
1
0
0
1
LRPC
2
4
UNEMPLOYMENT (Percent)
SRPC
3
5
6
SRPC
LRPC
?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6cd821eb-6ff2-4dd2-a82f-3a0e5436c8d8%2Ff066425d-5219-4e89-a7f0-fe9916fd1dc0%2F97f9e46_processed.png&w=3840&q=75)
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