Phillips curve: expansionary policy in the short run and the long run (A to B to C)

An example figure from the Phillips Curve generator.

Phillips curve graph with no numbers on the axes: point A where the blue curve SRPC₁ crosses the vertical red LRPC; a black arrow up along SRPC₁ to point B, at lower unemployment and higher inflation; a second blue curve SRPC₂ above and to the right of SRPC₁, with two blue arrows from SRPC₁ to it; and a black arrow across from B to point C, where SRPC₂ crosses the LRPC. Dashed lines run from the points to the axes, labeled π₁ and π₂ on the inflation axis and u₁ and uₙ on the unemployment axis — The economy starts at A, where the short-run Phillips curve SRPC₁ crosses the long-run Phillips curve (LRPC) at the natural rate uₙ, with inflation at π₁. It moves up along SRPC₁ to B, where unemployment has fallen to u₁ and inflation has risen to π₂. The SRPC then shifts up to SRPC₂, and the economy moves across to C on the LRPC, back at uₙ with inflation at π₂.

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