Upgrade to access all content for this subject
Which of the following is a true interpretation of the interaction between the Aggregate Supply/Aggregate Demand model and changes in the short-run Phillips curve?
The concepts taken together prove that inflation can be used to obtain long-term job gains.
Unemployment rate increases cause higher inflation rates.
Increased aggregate demand causes inflation and unemployment to fall.
Decreased aggregate demand causes employment rates to rise if inflation is low.
Inflation may not be used to sustain long-term job creation.