If the supply of money increases, the long-run aggregate supply curve suggests that output will not change but the price level will.

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The long-run aggregate supply curve is vertical, indicating that in the long run, the total output (real GDP) is determined by the economy's resources (labor, capital, etc.) and technology, not by the price level or money supply. An increase in the money supply can lead to higher prices (inflation) but does not change the economy's capacity to produce goods and services.

If the Supply of Money Increases, the Long-Run Aggregate Supply