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THE PHILLIPS CURVE QUIZ
http://www.softschools.com/quizzes/ap_macroeconomics/phillips_curve_and_inflation/quiz10464.html
Questions
1.
If inflationary expectations increase, the Phillips curve will
A: shift to the right
B: shift to the left
C: become vertical
D: become upward sloping
2.
An increase in aggregate demand when the economy is operating at full capacity is likely
to result in (assume an upward sloping AS curve)
A: A shift of the LRPC to the Right
B: A shift of the SRPC to the left
C: A shift of the SRPC to the right
D: A movement along the SRPC
E: A shift of the LRPC to the Left
3.
Suppose that there is an increase in the price of oil that affects the domestic economy.
Which direction will the SR Phillips Curve shift?
A: A shift of the LRPC to the Right
B: A shift of the SRPC to the left
C: A shift of the SRPC to the right
D: A movement along the SRPC
4.
If the Phillips Curve is vertical in the long run, then an increase in the money supply from
year to year will _______ the unemployment rate and will _________inflation rate.
A: increase; increase
B: increase; not change
C: not change; increase
D: not change; not change
5.
The Phillips curve shows the relationship between the
A: nominal interest rate and the real interest rate.
B: real interest rate and the unemployment rate.
C: unemployment rate and the inflation rate.
D: expected rate of inflation and the nominal interest rate.
6.
Suppose the expected inflation rate is 8 percent and the unemployment rate is 3
percent. If the inflation rate rises to 10 percent and the expected inflation rate
does not change,
A: the short-run Phillips curve will shift upward.
B: the natural unemployment rate will rise.
C: the short-run Phillips curve will shift downward.
D: there will be a movement along the short-run Phillips curve.
7.
Suppose the expected inflation rate is 12 percent and the unemployment rate is 5 percent.
If the expected inflation rate increases to 13 percent,
A: the natural unemployment rate will rise.
B: the short-run Phillips curve will shift downward.
C: the short-run Phillips curve will shift upward.
D: there will be a movement along the short-run Phillips curve.
8.
According to the long-run Phillips Curve, which of the following is true?
A: The natural rate of unemployment is independent of monetary and fiscal policy
changes that affect aggregate demand.
B: Inflationary expectations play no role in the position on the Phillips Curve.
C: Changes in aggregate demand shift the Phillips Curve and expansionary fiscal
policy moves the long run Phillips Curve.
D: The Phillips Curve shows a direct relationship between inflation and
unemployment
9.
An increase in short-run aggregate supply will lead to,
A: inflation is lower and unemployment increases
B: inflation is higher and unemployment decreases
C: An increase, or shift to the right of the SRPC
D: An increase, or shift to the right of the LRPC
10.
Which of the following best explains how an economy could simultaneously experience
high inflation and high unemployment?
A: Negative supply shocks
B: Positive supply shocks
C: Aggregate demand shock
D: Negative net exports
Output, prices and jobs
Sep 12th 2015 | From the print edition
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