# Short run phillips curve

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#1
https://filestore.aqa.org.uk/sample-...3-QP-JUN18.PDF

For question 9 in this question paper,

I understand that answer D is correct, however I do not understand why answer B is incorrect.

Isn't it also true that there is an inversely proportional relationship between
unemployment and inflation because according to the SRPC, as unemployment falls inflation increases and vice versa?
0
1 year ago
#2
(Original post by ChloeYeo)
https://filestore.aqa.org.uk/sample-...3-QP-JUN18.PDF

For question 9 in this question paper,

I understand that answer D is correct, however I do not understand why answer B is incorrect.

Isn't it also true that there is an inversely proportional relationship between
unemployment and inflation because according to the SRPC, as unemployment falls inflation increases and vice versa?
If there is inverse proportion, the curve will never ever intersect the x axis (because you do a levels I’m assuming you did gcse maths)

The definition of inverse proportion is when 1 variable goes up the other goes down, and you get the equation y=k/x , where k is a constant.

Using this rule you get a reciprocal graph , which will get closer and closer to 0 but never quite reaching 0.

For example in an economic perspective if you have a finite amount of resources (let that be constant k which could equal 50 units for example) and divide that by a growing population (let that be x) to give the amount of resources each person gets (let that be y), each person will get a smaller and smaller amount as the population grows, but nobody will ever get nothing and if the curve ever intersects the x-axis (ie somebody getting nothing) there is no inverse proportion, so you can’t say you can observe such thing.

I’m reallly sorry if that confused you 😂 but the only proper explanation I can give is in terms of maths, although I do aqa a level econ as well. Hope this helps, if not I hope you find your answer
Last edited by hustlr; 1 year ago
1
#3
(Original post by hustlr)
If there is inverse proportion, the curve will never ever intersect the x axis (because you do a levels I’m assuming you did gcse maths)

The definition of inverse proportion is when 1 variable goes up the other goes down, and you get the equation y=k/x , where k is a constant.

Using this rule you get a reciprocal graph , which will get closer and closer to 0 but never quite reaching 0.

For example in an economic perspective if you have a finite amount of resources (let that be constant k which could equal 50 units for example) and divide that by a growing population (let that be x) to give the amount of resources each person gets (let that be y), each person will get a smaller and smaller amount as the population grows, but nobody will ever get nothing and if the curve ever intersects the x-axis (ie somebody getting nothing) there is no inverse proportion, so you can’t say you can observe such thing.

I’m reallly sorry if that confused you 😂 but the only proper explanation I can give is in terms of maths, although I do aqa a level econ as well. Hope this helps, if not I hope you find your answer
OHHHH omg thank you so much!!
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