In the United States during the late 1990s, the unemployment rate fell from prev

Question

In the United States during the late 1990s, the unemployment rate fell from previous years and the inflation rate was lower than in previous years. This set of events is best described by saying that the

A) short-run Phillips curve shifted downward.

B) economy moved to a lower point on its short-run Phillips curve but the short-run Phillips curve did not shift.

C) economy moved to a higher point on its short-run Phillips curve but the short-run Phillips curve did not shift.

D) long-run Phillips curve shifted rightward.

E) short-run Phillips curve shifted upward.

Explanation / Answer

Economy moved to a lower point on its short-run Phillips cruve but the short-run phillips curve did not shift.

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