If actual inflation differs from expected inflation, what is the slope of the aggregate supply curve?

Question

Quizplus · Accepted Answer

In the short run, the aggregate supply curve has a positive slope, meaning that when actual inflation is greater than expected inflation, there will be an increase in output and vice versa. However, in the long run, the slope of the aggregate supply curve becomes vertical, meaning that the level of output is determined by the factors of production and not affected by changes in price levels. Therefore, in the long run, actual inflation will not affect output, resulting in a vertical slope.

If Actual Inflation Differs from Expected Inflation, What Is the Slope