If the actual inflation rate is equal to the expected rate, which of the following will happen?
a. inflationary expectations will increase and the Phillips curve will shift downward in the short run.
b. inflationary expectations will not change and the Phillips curve will remain in its current position in the short run.
c. inflationary expectations will decrease and the Phillips curve will shift downward in the short run.
d. inflationary expectations will stay constant and the Phillips curve will shift downward in the short run.
e. inflationary expectations will not change and the Phillips curve will become horizontal in the short run.
B
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The CB radio was very popular in the 1970s and 1980s for communicating while driving. People bought them because other drivers had them too and they could therefore talk with many others on their trips. This illustrates
A) that the demand curve for CB radios was inelastic. B) the network effect. C) that CB radios and gasoline are complementary goods. D) the effects of mobile phones on the demand curve for CB radios.