1. If the wages were to more rigid, what would happen to the slope of this...

1. If the wages were to more rigid, what would happen to the slope of this Phillips Curve?

2. How do public expectations of higher future inflation affect the short-run aggregate supply curve? Show your answer in a graph.

1. π= 3-0.5(U-5)

Solutions

Expert Solution

Ans 1) Wage indexation can be the primary source of Wage rigidity.

Rahul Sunny answered 1 year ago

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