In which of the following economic theories is the short-run aggregate supply curve thought to be upward sloping, and the long-run aggregate supply curve thought to be perfectly vertical at the natural rate of unemployment?
A) Supply-side economics.
B) The new classical theory.
C) The new Keynesian theory.
D) All of the above.

Question

Quizplus · Accepted Answer

The new classical theory posits that the short-run aggregate supply curve is upward sloping due to price and wage stickiness, while the long-run aggregate supply curve is vertical at the natural rate of unemployment, reflecting full employment.

In Which of the Following Economic Theories Is the Short-Run