4. (12 pts) In a Phillips curve/Dynamic Aggregate supply curve such as Tlt = Tt-1 + $(Yt - 7:) + Vt, a) which variable(s

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4 12 Pts In A Phillips Curve Dynamic Aggregate Supply Curve Such As Tlt Tt 1 Yt 7 Vt A Which Variable S 1 (118.52 KiB) Viewed 34 times

4. (12 pts) In a Phillips curve/Dynamic Aggregate supply curve such as Tlt = Tt-1 + $(Yt - 7:) + Vt, a) which variable(s) would be associated with cost-push inflation and which with demand-pull inflation? b) If you were to observe two short-term equilibria, the second with higher inflation than the first, how could you tell whether the increase in inflation was primarily cost-push or demand-pull? + K