In the context of the Phillips Curve, a decrease in unemployment is typically associated with an increase in ________.

In the context of the Phillips Curve, a decrease in unemployment is typically associated with an increase in inflation. This relationship suggests that when more people have jobs, they tend to spend more money, which can drive prices up. For example, if a city has a low unemployment rate, more workers have income to buy goods and services, causing businesses to raise their prices due to higher demand. This increase in demand can lead to inflation, making it more expensive for everyone to buy the same items. Therefore, the Phillips Curve illustrates the trade-off between unemployment and inflation, indicating that lower unemployment may lead to higher inflation rates.