20–30% of the AP exam. Key topics: Short-run Phillips Curve (SRPC): inverse relationship between inflation and unemployment, Long-run Phillips Curve (LRPC): vertical at NAIRU; adaptive expectations, Stagflation and supply-side shocks; SRPC shifts left/up with cost-push inflation, Effects of fiscal and monetary policy on the Phillips Curve in the short and long run, Quantity theory of money (MV = PQ); long-run neutrality of money, Economic growth: capital accumulation, productivity improvements, rule of 70, Policy responses to recessionary gaps vs. supply-side inflationary shocks.
Study guide content for this unit is being prepared. Check back soon for complete lesson notes, formula sheets, and worked examples.
