Which factor would cause the long-run Phillips curve to shift rightward?

Multiple choice question for The Phillips Curve. Select an option, then review the explanation below.

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A rise in the minimum wageAn increase in inflation expectationsA surge in the cost of imported oilA boost in aggregate demandA decrease in government spending

Explanation

The long-run Phillips curve shifts to the right when there is an increase in structural unemployment factors, such as a higher minimum wage, which raises the natural rate of unemployment. Changes in expected inflation or aggregate demand affect the short-run Phillips curve but do not shift the long-run curve.

Practice related questions from the same subject.

1.What is the likely effect of a credible and announced monetary policy tightening if individuals form rational expectations?
2.Refer to Exhibit 6. If the economy is initially at long-run equilibrium at point E, which point will the economy move toward following an unanticipated monetary tightening?
3.Refer to Exhibit 6. If the economy is initially at long-run equilibrium at point E, what point will the economy move toward following a sudden rise in government expenditure?
4.Based on Exhibit 6, if individuals anticipate a 3% inflation rate and the actual inflation rate is also 3%, at which point is the economy functioning?
5.What is the effect of a reduction in the price of imported oil on the short-run Phillips curve?

Which factor would cause the long-run Phillips curve to shift rightward?

Explanation

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