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Inflation and Unemployment
The Relationship Between Inflation and Unemployment
Economics Textbooks Boundless Economics Inflation and Unemployment The Relationship Between Inflation and Unemployment
Economics Textbooks Boundless Economics Inflation and Unemployment
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Economics
Concept Version 7
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The Phillips Curve

Theoretical Phillips Curve

Theoretical Phillips Curve

The Phillips curve shows the inverse trade-off between inflation and unemployment. As one increases, the other must decrease. In this image, an economy can either experience 3% unemployment at the cost of 6% of inflation, or increase unemployment to 5% to bring down the inflation levels to 2%.

Source

    Boundless vets and curates high-quality, openly licensed content from around the Internet. This particular resource used the following sources:

    Wikispaces.
    https://ib-econ.wikispaces.com/Q18-Macro+(Is+there+a+long-term+trade-off+between+inflation+and+unemployment?) CC BY-SA.

Related Terms

  • stagflation
  • Phillips curve
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