Refer to the graph shown. If expected inflation increases from 0 percent to 6 percent, the:
A. economy will move from point B to point C.
B. short-run Phillips curve will shift from PC2 to PC1.
C. short-run Phillips curve will shift from PC1 to PC2.
D. economy will move from point C to point A.
Answer: C
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What will be an ideal response?
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A) E to B to D. B) A to E. C) A to B to C. D) A to D.
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