1. Chapter 12 Unemployment and Inflation

2. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-2 Figure 12.1 The Phillips curve and the U.S. economy during the 1960s

3. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-3 Figure 12.2 Inflation and unemployment in the United States, 1970–2002

4. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-4 Figure 12.3 Ongoing inflation in the extended classical model

5. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-5 Figure 12.4 Unanticipated inflation in the extended classical model

6. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-6 Figure 12.5 The shifting Phillips curve: an increase in expected inflation

7. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-7 Figure 12.6 The shifting Phillips curve: an increase in the natural unemployment rate

8. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-8 Figure 12.7 The expectations-augmented Phillips curve in the United States, 1970–2002

9. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-9 Figure 12.8 The long-run Phillips curve

10. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-10 Figure 12.9 Actual and natural unemployment rates in the United States

11. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-11 Figure 12.10 Unemployment rates by demographic group

12. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-12 Figure 12.10 Unemployment rates by demographic group (contd)

13. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-13 Figure 12.11 Unemployment rates in Western Europe

14. Copyright © 2005 Pearson Addison-Wesley. All rights reserved. 12-14 Box 12.4 The Sacrifice Ratio