Question:
Match List-I with List-II.
List-I List-II A. Expectation Augmented Phillips curve I. Long run vertical Phillips curve B. Natural rate of unemployment II. Excess aggregate demand C. Demand pull inflation III. Wage price spiral D. Cost push inflation IV. Friedman
Match List-I with List-II.
| List-I | List-II |
|---|---|
| A. Expectation Augmented Phillips curve | I. Long run vertical Phillips curve |
| B. Natural rate of unemployment | II. Excess aggregate demand |
| C. Demand pull inflation | III. Wage price spiral |
| D. Cost push inflation | IV. Friedman |
Show Hint
Demand-pull inflation is caused by excess aggregate demand, while cost-push inflation is linked with rising production costs and wage-price spiral.
Updated On: May 22, 2026
- A-I, B-II, C-III, D-IV
- A-IV, B-II, C-I, D-III
- A-IV, B-I, C-III, D-II
- A-IV, B-III, C-II, D-I
Show Solution
Verified By Collegedunia
The Correct Option is B
Solution and Explanation
Concept: Phillips curve analysis explains the relation between inflation and unemployment. Later developments included expectations and natural rate of unemployment.
Step 1: Match Expectation Augmented Phillips Curve.
The expectation augmented Phillips curve is associated with Milton Friedman. \[ A \rightarrow IV \]
Step 2: Match Natural Rate of Unemployment.
The natural rate of unemployment is linked with the long-run vertical Phillips curve. \[ B \rightarrow I \]
Step 3: Match Demand Pull Inflation.
Demand pull inflation occurs due to excess aggregate demand. \[ C \rightarrow II \]
Step 4: Match Cost Push Inflation.
Cost push inflation may arise due to rising wages and production costs, often producing a wage-price spiral. \[ D \rightarrow III \] Therefore, the correct matching should be: \[ A-IV,\ B-I,\ C-II,\ D-III \] But this exact combination is not present among the given options.
Step 1: Match Expectation Augmented Phillips Curve.
The expectation augmented Phillips curve is associated with Milton Friedman. \[ A \rightarrow IV \]
Step 2: Match Natural Rate of Unemployment.
The natural rate of unemployment is linked with the long-run vertical Phillips curve. \[ B \rightarrow I \]
Step 3: Match Demand Pull Inflation.
Demand pull inflation occurs due to excess aggregate demand. \[ C \rightarrow II \]
Step 4: Match Cost Push Inflation.
Cost push inflation may arise due to rising wages and production costs, often producing a wage-price spiral. \[ D \rightarrow III \] Therefore, the correct matching should be: \[ A-IV,\ B-I,\ C-II,\ D-III \] But this exact combination is not present among the given options.
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