Phillips Curve (4/18)
- In the Short Run, the Phillip's Curve represents the Trade-Off btwn Inflation (π%) and Unemployment (Un%)
- It is an inverse relationship (π%↑,Un%↓)
- Each point of the PhC corresponds to different lvls of output
- In the Long Run PhC, it occurs at NRU(4%-5%)
- represented by a vertical line
- no tradeoff btwn π% and Un%
- in LRPC, the economy produces at Full Employment output lvl
- LRPC only shifts when LRAS shifts
- Un↑,LRPC→ ; Un↓, LRPC←
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