Statements 1 and 2 are true with respect to the Phillips Curve. The Phillips Curve is an economic concept developed by A.W. Phillips showing that inflation and unemployment have a stable and inverse relationship. The theory states that with economic growth comes inflation, which, in turn, should lead to more jobs and less unemployment. The non-accelerating inflation rate of unemployment (NAIRU) – also referred to as the long-run Phillips curve – is the specific level of unemployment that is evident in an economy that does not cause inflation to rise up and it is not horizontal.