The fact that the long-run Phillips curve is vertical implies that
A)monetary policy can't affect unemployment.
B)money is neutral in the long run.
C)there is a natural rate of inflation.
D)money can't affect inflation in the long run.

Question

Quizplus · Accepted Answer

The vertical long-run Phillips curve suggests that there is no trade-off between inflation and unemployment in the long run, implying that money is neutral in the long run. This means changes in the money supply only affect prices and not real variables like output or unemployment.

The Fact That the Long-Run Phillips Curve Is Vertical Implies