Eve is trying to calculate how much she should change her prices for physical therapy sessions for the coming year, if she expects inflation to be equal to 2.9% and estimates that GDP will be 5% smaller than potential output, by what amount should she increase her prices according to the attached Phillips curve? Unexpected inflation (Inflation-inflation expectations) 15 1% -2% -10% 596 Output gap (GDP sve to po GOP 2.996 1.9% $7.9% Phillips curva -5% 10% Output gap (GDP, relative to potential GDP) 0%

Eve is trying to calculate how much she should change her prices for physical therapy sessions for the coming year, if she expects inflation to be equal to 2.9% and estimates that GDP will be 5% smaller than potential output, by what amount should she increase her prices according to the attached Phillips curve? Unexpected inflation (Inflation-inflation expectations) 15 1% -2% -10% 596 Output gap (GDP sve to po GOP 2.996 1.9% $7.9% Phillips curva -5% 10% Output gap (GDP, relative to potential GDP) 0%

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter22: Inflation

Section: Chapter Questions

Problem 33P: The index number representing the price level changes from 110 to 115 in one year and then from 115...

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