Answer to Question #80812 in Macroeconomics for AYANDA

Question

The phillips curve shows that a decrease in aggregate demand will result in....and....

1) A decrease in unemployment rate; a decrease in inflation rate
2) An increase in unemployment rate; a decrease in inflation rate
3) An increase in unemployment rate; a decrease in inflation rate
4) A decrease in unemployment rate; an increase inflation rate

Answer 1

2) An increase in unemployment rate; a decrease in inflation rate
3) An increase in unemployment rate; a decrease in inflation rate