Economists who view the AS curve as vertical believe that government cannot do anything to raise Real GDP from the demand side of the economy.

Question

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Economists who view the AS curve as vertical believe that the economy has reached its full potential output and any attempts to increase demand will only result in higher prices without an increase in Real GDP. Therefore, they argue that government intervention, such as fiscal or monetary policies, will be ineffective in boosting Real GDP from the demand side of the economy.

Economists Who View the AS Curve as Vertical Believe That