A) It shows the relationship between tax revenue collection and tax rate
B) It indicates the variation of productivity of a firm with the change in the capital investment
C) It shows the relationship between per-capita income and population
D) It shows the relationship between the rate of inflation and rate of unemployment
Correct Answer: D
Solution :
[d] The Phillips curve shows the relationship between the rate of inflation and rate of unemployment. It is a historical inverse relationship between the rate of unemployment and the rate of inflation in an economy. Lower unemployment in an economy is correlated with a higher rate of inflation.
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