The long-run Phillips curve is
A)downward-sloping
B)vertical
C)upward-sloping
D)horizontal
E)U-shaped

Question

Quizplus · Accepted Answer

The long-run Phillips curve is vertical, indicating that unemployment and inflation have no consistent trade-off in the long run. This is due to the fact that in the long run, prices and wages are flexible, leading to adjustment to changes in aggregate supply and demand, and therefore, no persistent trade-off between unemployment and inflation.

The Long-Run Phillips Curve Is