What is the difference between the short-run Phillips curve and the long-run Phillips curve?
A)The long-run Phillips curve is horizontal, indicating that the unemployment rate may change but inflation remains the same, whereas the short-run curve is vertical.
B)The long-run Phillips curve slopes upward, indicating a positive relationship between the unemployment rate and inflation, whereas the short-run curve slopes downward.
C)The long-run Phillips curve is vertical, indicating that the unemployment rate may change but inflation does not, whereas the short-run curve is positively sloped.
D)The long-run Phillips curve is vertical, indicating that inflation may change but the unemployment rate does not, whereas the short-run curve is negatively sloped.
E)The long-run Phillips curve is negatively sloped, indicating an inverse relationship between unemployment and inflation, whereas the short-run curve is vertical.

Question

Quizplus · Accepted Answer

The long-run Phillips curve is vertical, indicating that in the long run, there is no trade-off between inflation and unemployment. In contrast, the short-run Phillips curve is negatively sloped, showing an inverse relationship between inflation and unemployment.

What Is the Difference Between the Short-Run Phillips Curve and the Long-Run