Week 12 — Assignment (Adaptive Learning) · The Phillips Curve & Quantity-Theory Problem Set

Course: Principles of Macroeconomics (ECON 2) · Silver Oak University (fictional sample) · Prof. Ashford
Objective 8 · SLO A & B · Assignment 12 of 14 · 100 points
This is the configured (adaptive) variant. An AI coach gives you the problems one at a time, grades each against an embedded rubric, lets you retry a fresh version, and produces a self-scored report. You submit the report (first line STUDENT'S SCORE: X/100) + your chat share link. (The traditional, instructor-graded version is in I-assignment-and-rubric-week-12-traditional.md.)

How to run this

1. Open an approved chatbot (Gemini, Claude, ChatGPT). Copy the whole gray box and paste it as one message.
2. Solve each problem; the coach grades it, teaches the gaps, and offers a fresh variant to raise your score.
3. When you get the report, submit it (it starts with STUDENT'S SCORE: X/100) plus your chat share link in Canvas. Due Sun, Nov 22.

You are my assignment coach and grader for Week 12 of Principles of Macroeconomics (ECON 2)
at Silver Oak University. Give me the problems below ONE AT A TIME, let me solve each, grade
my answer against the rubric, show me how to improve, and let me re-try a fresh version to
raise my score. Grade ONLY against the answer key and rubric below — never invent problems,
answers, or scores. Redo any arithmetic yourself and SHOW YOUR WORK before telling me I'm
wrong. Score honestly; a wrong answer scores low, a strong answer earns full marks.

HARD RULES (never break these): (1) never invent or misattribute a quotation, study,
statistic, or real-world data figure; (2) never take a partisan side on any contested
question — present reasoning fairly and never declare one economic priority objectively
"correct."

START: greet me in 1-2 sentences, ask my FIRST NAME, then give Problem 1 exactly as written.
If I answer without giving my name, keep going but ask before the final report. ONE problem
at a time; never show the whole set, the answers, the variants, or the rubric. After each
answer: grade it, say what I did well, TEACH the gap, then offer a re-attempt on the FRESH
VARIANT (update my score to my BEST attempt, capped at full marks). Judge meaning, not
wording. Every message ends with a problem, a question, or a next step.

================= PROBLEM 1 (25 pts) — MV = PQ: computing the price level =================
PROBLEM: "An economy has money supply M = 800, velocity V = 3, and real output Q = 1,200.
(a) Using MV = PQ, what is the price level P? (b) The money supply then rises by 15% (V and
Q unchanged). What is the NEW price level? (c) By what percentage did the price level
change, and what does this illustrate?"
VETTED ANSWER: (a) M x V = 800 x 3 = 2,400. P = (M x V)/Q = 2,400/1,200 = 2. (b) New M = 800
x 1.15 = 920. New M x V = 920 x 3 = 2,760. New P = 2,760/1,200 = 2.3. (c) The price level
rose from 2 to 2.3, a change of (2.3-2)/2 = 0.3/2 = 15% — EXACTLY matching the 15% rise in
the money supply. This illustrates LONG-RUN MONETARY NEUTRALITY: with V and Q fixed, a
change in the money supply produces a proportional change in the price level and NO change
in real output.
RUBRIC: 25 = all three parts correct with the neutrality interpretation stated in words.
15-20 = (a) and (b) correct, (c) missing the neutrality point or the percentage. 8-14 =
method right, one arithmetic slip (e.g., forgetting to multiply the multiplier's percentage
change correctly). 0-7 = wrong formula (e.g., divides M by Q without V, or multiplies
instead of dividing).
FRESH VARIANT: "M = 400, V = 6, Q = 1,600. (a) Find P. (b) M rises 10% (V, Q unchanged) —
find the new P. (c) What percentage change, and what does it illustrate?" ANSWER: (a) 400x6
= 2,400; P = 2,400/1,600 = 1.5. (b) New M = 440; new M x V = 440x6 = 2,640; new P =
2,640/1,600 = 1.65. (c) (1.65-1.5)/1.5 = 0.15/1.5 = 10%, matching the 10% money growth —
long-run monetary neutrality again.

================= PROBLEM 2 (25 pts) — The approximation & reading two SRPC points =================
PROBLEM: "(a) If the money supply grows 9% a year and real output grows 4% a year, use the
approximation 'inflation is approximately equal to money growth minus output growth' to
estimate the inflation rate, and state explicitly whether this is an exact law or an
approximation. (b) An economy's short-run Phillips curve passes through the point
(unemployment = 4%, inflation = 6%) and the point (unemployment = 6%, inflation = 2%). Does
inflation rise or fall as unemployment rises along this curve, and what does that confirm
about the SRPC's shape?"
VETTED ANSWER: (a) Approximate inflation = 9% - 4% = 5%. This is explicitly an
APPROXIMATION (a rule of thumb that assumes velocity is roughly stable), NOT an exact law —
unlike MV = PQ itself, which is an identity. (b) Moving from (4%, 6%) to (6%, 2%),
unemployment RISES (4%->6%) while inflation FALLS (6%->2%). This confirms the SRPC SLOPES
DOWN — the short-run trade-off between unemployment and inflation.
RUBRIC: 25 = both parts correct, with (a) EXPLICITLY labeling the result as an
approximation (not an exact law) and (b) explicitly naming the downward slope. 15-20 = both
numeric/directional answers right, but the "approximation, not exact law" or "downward
slope" language is missing. 8-14 = one part right, one wrong (e.g., reverses the direction
in (b), or treats (a) as an exact figure). 0-7 = both wrong.
FRESH VARIANT: "(a) Money supply grows 7% a year, real output grows 2% a year — estimate
inflation via the approximation. (b) A different economy's SRPC passes through
(unemployment = 3%, inflation = 8%) and (unemployment = 7%, inflation = 1%). Does inflation
rise or fall as unemployment rises, and what does that confirm?" ANSWER: (a) 7% - 2% = 5%
(approximation, not exact). (b) Unemployment rises (3%->7%), inflation falls (8%->1%) —
confirms the SRPC slopes down.

================= PROBLEM 3 (25 pts) — Comparative statics: expected inflation shifts the SRPC =================
PROBLEM: "An economy is currently on its short-run Phillips curve at the point (unemployment
= 5%, inflation = 3%). Workers and firms then come to EXPECT a higher inflation rate than
before, based on a run of recent price increases. (a) What happens to the SRPC — does it
shift, and if so, in which direction? (b) At the SAME unemployment rate (5%), is the NEW
inflation rate higher or lower than 3%? (c) Explain in 2-3 sentences why a policymaker who
tries to permanently exploit the ORIGINAL short-run trade-off (aiming for lower
unemployment than 5% by tolerating a bit more inflation) will eventually fail to get a
LASTING reduction in unemployment — name THE CLASSIC ERROR explicitly."
VETTED ANSWER: (a) The SRPC SHIFTS UP AND TO THE RIGHT — expected inflation gets built into
wage- and price-setting, so the whole short-run curve moves. (b) At the SAME 5%
unemployment, the NEW inflation rate is HIGHER than 3% (the shifted curve sits above the
old one at every unemployment rate). (c) THE CLASSIC ERROR is treating the short-run
trade-off as a permanent, exploitable long-run menu. If a policymaker keeps trying to hold
unemployment below the natural rate (5%) by tolerating ever-more inflation, people
eventually EXPECT that inflation and build it into their decisions — the SRPC keeps
shifting up, and unemployment drifts back to the natural rate (5%) anyway, just with
permanently higher inflation and no lasting unemployment gain. The long-run Phillips curve
is VERTICAL at 5% precisely because this process repeats no matter what inflation rate is
chosen.
RUBRIC: 25 = all three parts correct, with (c) correctly naming THE CLASSIC ERROR AND
explaining the shift-and-return mechanism. 15-20 = (a) and (b) correct, (c) vague or missing
the explicit "THE CLASSIC ERROR" naming. 8-14 = (a) correct but (b) or (c) confused
(e.g., says the SAME inflation rate persists, or claims unemployment CAN stay permanently
lower). 0-7 = (a) wrong (says the curve doesn't shift, or shifts the wrong direction).
FRESH VARIANT: "An economy sits on its SRPC at (unemployment = 6%, inflation = 4%). A
sustained period of low, credible inflation then causes people to LOWER their expected
inflation. (a) Which way does the SRPC shift? (b) At the same 6% unemployment, is the new
inflation rate higher or lower than 4%? (c) Would trying to hold unemployment permanently
BELOW the natural rate via this lower-inflation SRPC still run into THE CLASSIC ERROR if
policymakers pushed too far — why or why not?" ANSWER: (a) The SRPC shifts DOWN AND TO THE
LEFT (lower expected inflation reduces inflation at every unemployment rate). (b) Lower than
4%. (c) Yes — the SAME classic error applies regardless of which SRPC an economy is
currently on: pushing unemployment persistently below the natural rate (5%) on ANY given
SRPC will eventually raise expected inflation and shift the curve up again, since the
natural-rate/LRPC logic doesn't depend on which SRPC you started from.

================= PROBLEM 4 (25 pts) — Positive vs. normative + evenhanded reasoning =================
PROBLEM: "Label each claim POSITIVE or NORMATIVE, then in 3-4 sentences argue, evenhandedly,
whether a central bank should lean toward tolerating a bit more inflation or a bit more
unemployment when policy must occasionally err — presenting a real case for BOTH sides
rather than declaring a winner: (a) 'A hotter economy tends to run lower unemployment and
higher inflation, for a while.' (b) 'The central bank should prioritize protecting people on
fixed incomes from inflation, even if unemployment rises somewhat.' (c) 'Unemployment
disproportionately affects younger and lower-income workers during downturns.' (d) 'It is
more important to protect jobs during a downturn than to hold inflation at its very lowest
possible level.'"
VETTED ANSWER: (a) POSITIVE (a testable, observed short-run pattern). (b) NORMATIVE
('should'/'prioritize' — a value judgment). (c) POSITIVE (a testable claim about who loses
jobs in downturns). (d) NORMATIVE ('more important' — a value judgment). The short argument
earns credit for presenting BOTH sides fairly: the case for erring toward tolerating a bit
more inflation (unemployment's costs can be severe, concentrated, and immediate for workers
who lose income) AND the case for erring toward tolerating a bit more unemployment
(inflation's costs are diffuse but compounding, and disproportionately harm people on fixed
incomes and savers) — either weighting is acceptable if reasoned and fair, since economists
and policymakers genuinely disagree on this short-run trade-off (this is explicitly NOT a
question about whether the long-run trade-off exists — it doesn't; THE CLASSIC ERROR
already ruled that out).
RUBRIC: 25 = all four labels correct + a reasoned paragraph that visibly presents BOTH sides
and does not declare one priority objectively "correct," while keeping the short-run framing
explicit. 15-20 = 3 labels right and/or the paragraph favors one side without genuinely
engaging the other. 8-14 = 2 labels right or no real evenhandedness. 0-7 = mostly mislabeled
or takes a hard partisan stance as settled fact, or implies the trade-off is permanent.
FRESH VARIANT: "Label and argue the same way for whether a central bank should raise
interest rates quickly to fight a sudden burst of inflation, or move more gradually to avoid
tipping the economy into a recession: (a) 'Raising interest rates quickly typically slows
borrowing and spending faster than a gradual increase.' (b) 'The central bank should move
quickly, even at some risk of recession, to keep inflation expectations from becoming
unanchored.' (c) 'Rapid rate increases have historically been associated with a higher
short-run risk of recession than gradual increases.' (d) 'It is better to move gradually and
accept a slower return to low inflation than to risk throwing people out of work.'" ANSWER:
(a) POSITIVE, (b) NORMATIVE, (c) POSITIVE, (d) NORMATIVE.

================= COMPLETION =================
After all four problems (and any re-attempts), produce EXACTLY:
    STUDENT'S SCORE: X/100
    WEEK 12 ASSIGNMENT — The Phillips Curve & Quantity-Theory Problem Set
    Student: [name] | Date: ___
    Problem 1: a/25 — [one-line note]
    Problem 2: b/25 — [one-line note]
    Problem 3: c/25 — [one-line note]
    Problem 4: d/25 — [one-line note]
    Strongest skill: ___
    Worth another look: ___
Then say, verbatim: "Copy this entire report AND your share link to this chat, and submit both
in Canvas for this assignment." End with one genuine sentence of encouragement.

Instructor grading note + rubric (for Canvas)

Record the AI score (line 1); spot-check a sample against the chat share link. The embedded key makes scores consistent across chatbots. Summary rubric (each problem to 25, total 100):

Quantitative gate: PASS — every number pre-computed/re-verified: P1 800×3/1200=2, +15%→920×3/1200=2.3 (15%=15%, neutrality); P1 variant 400×6/1600=1.5, +10%→440×6/1600=1.65 (10%=10%); P2 9−4=5 and variant 7−2=5 (both labeled approximations).
Graph-logic check: PASS — every Phillips-curve claim verified: P2/P3 SRPC slopes down through the stated points; P3 expected-inflation shift is up/right (and its mirror, down/left in the variant), never "along the curve"; THE CLASSIC ERROR correctly named as "short-run trade-off treated as permanent," never endorsed as real. No free-numeric-only item is auto-graded against a single "right" wording (P4 grades labels + evenhanded reasoning).

Canvas placement block

canvas_object    = Assignment
title            = "Week 12 Assignment — The Phillips Curve & Quantity-Theory Problem Set (adaptive)"
assignment_group = "Assignments"
points_possible  = 100
grading_type     = points
submission_types = [online_text_entry, online_url]
due_offset_days  = 6
published        = true
submission_note  = "Paste the AI summary report (score on line 1) + the chat share link."
provenance       = "~ Prof. Ashford's edition · Fall 2026 · built with thecoursemaker.com"

Traditional variant — for comparison. This course is configured adaptive learning, so the actual Week-12 assignment is the AI-coached version in I-assignment-and-rubric-week-12.md. This file shows the same problem set built the traditional way — students complete it and submit; the instructor grades against the rubric. (Choosing assignment_type = traditional at setup generates this style.)

Course: Principles of Macroeconomics (ECON 2) · Silver Oak University (fictional sample) · Prof. Ashford
Objective 8 · SLO A & B · Assignment 12 of 14 · 100 points · Due Sun, Nov 22

The Assignment

Show your work and write your interpretations in complete sentences. Submit as a document or text entry.

Problem 1 — MV = PQ: computing the price level (25 pts). An economy has money supply M = 800, velocity V = 3, and real output Q = 1,200.
(a) Using MV = PQ, what is the price level P?
(b) The money supply then rises by 15% (V and Q unchanged). What is the NEW price level?
(c) By what percentage did the price level change, and what does this illustrate?

Problem 2 — The approximation & reading two SRPC points (25 pts).
(a) If the money supply grows 9% a year and real output grows 4% a year, use the approximation "inflation is approximately equal to money growth minus output growth" to estimate the inflation rate, and state explicitly whether this is an exact law or an approximation.
(b) An economy's short-run Phillips curve passes through the point (unemployment = 4%, inflation = 6%) and the point (unemployment = 6%, inflation = 2%). Does inflation rise or fall as unemployment rises along this curve, and what does that confirm about the SRPC's shape?

Problem 3 — Comparative statics: expected inflation shifts the SRPC (25 pts). An economy is currently on its short-run Phillips curve at the point (unemployment = 5%, inflation = 3%). Workers and firms then come to EXPECT a higher inflation rate than before, based on a run of recent price increases.
(a) What happens to the SRPC — does it shift, and if so, in which direction?
(b) At the SAME unemployment rate (5%), is the NEW inflation rate higher or lower than 3%?
(c) Explain in 2–3 sentences why a policymaker who tries to permanently exploit the ORIGINAL short-run trade-off (aiming for lower unemployment than 5% by tolerating a bit more inflation) will eventually fail to get a LASTING reduction in unemployment — name THE CLASSIC ERROR explicitly.

Problem 4 — Positive vs. normative + evenhanded reasoning (25 pts). Label each claim positive or normative, then in 3–4 sentences argue, evenhandedly, whether a central bank should lean toward tolerating a bit more inflation or a bit more unemployment when policy must occasionally err — presenting a real case for BOTH sides rather than declaring a winner:
(a) "A hotter economy tends to run lower unemployment and higher inflation, for a while." (b) "The central bank should prioritize protecting people on fixed incomes from inflation, even if unemployment rises somewhat." (c) "Unemployment disproportionately affects younger and lower-income workers during downturns." (d) "It is more important to protect jobs during a downturn than to hold inflation at its very lowest possible level."

AI note. This is the traditional format — submit your own work. You may use an approved chatbot to check a definition, but add a one-line note of which tool and how. (In the adaptive version, working the problems with the chatbot is the activity.)

Grading rubric — 100 points

Instructor answer key & worked solutions — REMOVE BEFORE PUBLISHING TO STUDENTS

• P1: (a) M×V = 800×3 = 2,400. P = 2,400/1,200 = 2. (b) New M = 800×1.15 = 920. New M×V = 920×3 = 2,760. New P = 2,760/1,200 = 2.3. (c) (2.3−2)/2 = 0.3/2 = 15% — exactly matching the 15% rise in the money supply. This illustrates long-run monetary neutrality: with V and Q fixed, a change in the money supply produces a proportional change in the price level and NO change in real output. (Numbers pre-computed/verified.)
• P2: (a) Approximate inflation = 9% − 4% = 5%. Explicitly an approximation (assumes stable velocity), NOT an exact law — unlike MV = PQ itself, which is an identity. (b) Moving from (4%, 6%) to (6%, 2%), unemployment rises (4%→6%) while inflation falls (6%→2%) — confirming the SRPC slopes down. (Verified.)
• P3: (a) The SRPC shifts up and to the right — expected inflation gets built into wage/price decisions, moving the whole short-run curve. (b) At the same 5% unemployment, the new inflation rate is higher than 3%. (c) THE CLASSIC ERROR is treating the short-run trade-off as a permanent, exploitable long-run menu. If a policymaker keeps trying to hold unemployment below the natural rate (5%) by tolerating ever-more inflation, people eventually expect that inflation and build it in — the SRPC keeps shifting up, and unemployment drifts back to 5% anyway, just with permanently higher inflation and no lasting unemployment gain. The LRPC is vertical at 5% precisely because this process repeats regardless of which inflation rate is chosen. (Curve-shift direction verified.)
• P4: (a) positive (a testable, observed short-run pattern), (b) normative ("should"/"prioritize"), (c) positive (a testable claim about who loses jobs in downturns), (d) normative ("more important" — a value judgment). Full credit on the paragraph requires presenting both the case for erring toward tolerating a bit more inflation (unemployment's costs can be severe, concentrated, and immediate) and the case for erring toward tolerating a bit more unemployment (inflation's costs are diffuse but compounding and disproportionately harm fixed incomes and savers) — either weighting is acceptable if reasoned and fair (evenhandedness); this is explicitly NOT a question about whether the long-run trade-off exists (it doesn't — THE CLASSIC ERROR already ruled that out), only about the short-run values question.

Quantitative gate: PASS — all numbers re-computed in Python (P1: 800×3/1200=2, +15%→920×3/1200=2.3, 15%=15%; P2: 9−4=5; all variant checks land clean).
Graph-logic check: PASS — every Phillips-curve/curve-shift claim verified (SRPC slopes down through the stated points; expected-inflation shift is up/right; THE CLASSIC ERROR correctly named and never endorsed as real).

Quality gate (self-checked): distractors/traps named: SRPC slope direction, "approximation vs. exact identity," treating the short-run trade-off as permanent (THE CLASSIC ERROR), declaring one policy priority objectively correct.

Canvas placement block

canvas_object    = Assignment
title            = "Week 12 Assignment — The Phillips Curve & Quantity-Theory Problem Set (traditional)"
assignment_group = "Assignments"
points_possible  = 100
grading_type     = points
submission_types = [online_upload, online_text_entry]
due_offset_days  = 6
rubric_ref       = "w12-assignment-rubric"
published        = true
provenance       = "~ Prof. Ashford's edition · Fall 2026 · built with thecoursemaker.com"