Here are some news reports covering events of the past 35 years. In each case, identify the stage of the inflation–unemployment cycle, and suggest what change in aggregate demand or aggregate supply...

Here are some news reports covering events of the past 35 years. In each case, identify the stage of the inflation–unemployment cycle, and suggest what change in aggregate demand or aggregate supply might have caused it.

a. “President Nixon expressed satisfaction with last year’s economic performance. He said that with inflation and unemployment heading down, the nation ‘is on the right course.’”

b. “The nation’s inflation rate rose to a record high last month, the government reported yesterday. The consumer price index jumped 0.3% in January. Coupled with the announcement earlier this month that unemployment had risen by 0.5 percentage points, the reports suggested that the first month of President Nixon’s second term had gotten off to a rocky start.”

c. “President Carter expressed concern about reports of rising inflation but insisted the economy is on the right course. He pointed to recent reductions in unemployment as evidence that his economic policies are working.” The text notes that changes in oil prices can affect the inflation–unemployment cycle. Should they be incorporated as part of the theory of the cycle?