The _____ curve is vertical at full employment.
A) short-run aggregate supply
B) long-run aggregate supply
C) short-run aggregate demand
D) long-run aggregate demand

Question

Quizplus · Accepted Answer

The long-run aggregate supply curve is vertical at full employment because in the long run, all resources are fully utilized and the economy operates at its potential output level. Any increase in aggregate demand will only lead to an increase in prices, not output, in the long run.

The _____ Curve Is Vertical at Full Employment