If expected inflation decreases by 2%, how would you calculate the shift in the short-run Phillips Curve?

• A. The short-run Phillips Curve shifts to the left by the same percentage decrease in expected inflation.
• B. The short-run Phillips Curve remains unchanged.
• C. The short-run Phillips Curve shifts to the right by the same percentage decrease in expected inflation.
• D. The short-run Phillips Curve shifts vertically.

Answer: (A)