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Disinflation and Deflation
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Disinflation and Deflation
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20. Tradeoffs Between Inflation and Unemployment / Disinflation and Deflation / Problem 7
Problem 7
During a period of disinflation, what is the expected movement along the short-run Phillips curve?
A
No movement, as inflation and unemployment remain constant.
B
Movement to the left, indicating lower inflation and lower unemployment.
C
Movement down the curve, indicating lower inflation and higher unemployment.
D
Movement up the curve, indicating higher inflation and lower unemployment.
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