According to the long-run Phillips curve, in the long run monetary policy influences
A)both the inflation rate and the unemployment rate.
B)the inflation rate but not the unemployment rate.
C)the unemployment rate but not the inflation rate.
D)neither the unemployment rate nor the inflation rate.

Question

Quizplus · Accepted Answer

The long-run Phillips curve suggests that in the long run, monetary policy can influence the inflation rate but not the unemployment rate, as the economy adjusts to its natural rate of unemployment regardless of inflation.

According to the Long-Run Phillips Curve, in the Long Run