In the long run, the Phillips curve will be ________ at the natural rate of unemployment if the long-run aggregate supply curve is vertical at potential output.

Question

Quizplus · Accepted Answer

If the long-run aggregate supply curve is vertical at potential output, it means that there is no relationship between inflation and unemployment in the long run. Therefore, the Phillips curve will be vertical as well, indicating that any unemployment rate can coexist with only one rate of inflation in the long run.

In the Long Run, the Phillips Curve Will Be ________