The long-run Phillips curve represents the relationship between the inflation rate and the unemployment rate when there is no ________ unemployment.
A) cyclical
B) structural
C) seasonal
D) frictional
E) natural

Question

Quizplus · Accepted Answer

In the long run, the Phillips curve is vertical at the natural rate of unemployment, which includes structural, frictional, and seasonal unemployment, but not cyclical unemployment. Cyclical unemployment is associated with short-term economic fluctuations and is not present in the long-run equilibrium.

The Long-Run Phillips Curve Represents the Relationship Between the Inflation