Inflation and Unemployment

These flashcards cover the key vocabulary and concepts related to inflation, unemployment, and the phases within the Phillips Curve.

Phillips Curve

A graph showing the relationship between inflation and unemployment rates.

Inflation

The rate at which the general level of prices for goods and services rises.

Unemployment

The situation when people who are capable of working are unable to find a job.

Stagflation Phase

A phase where unemployment rises while inflation remains high.

Recovery Phase

A phase in which inflation and unemployment both fall.

Phillips Phase

Characterized by rising inflation and falling unemployment.

Aggregate Demand

The total demand for goods and services within an economy.

Short-run Aggregate Supply

The total amount of goods and services that producers are willing and able to supply at a given overall price level in the short run.

Real GDP

The measure of a country's economic output adjusted for price changes (inflation or deflation).

Price Level

The average level of prices in the economy, often used to measure inflation.