Which of the following implies that an increase in the money supply growth rate permanently changes the unemployment rate?
A)both the long-run aggregate supply curve and the long-run Phillips curve
B)the long-run aggregate supply curve,but not the long-run Phillips curve
C)the long-run Phillips curve,but not the long-run aggregate supply curve
D)neither the long-run Phillips curve nor the long-run aggregate supply curve

Question

Quizplus · Accepted Answer

In the long run, the unemployment rate is determined by structural factors and is not affected by changes in the money supply. Both the long-run aggregate supply curve and the long-run Phillips curve are vertical, indicating that monetary policy does not have a permanent effect on the unemployment rate.

Which of the Following Implies That an Increase in the Money