The long-run Phillips curve:
A)is horizontal.
B)is the same as the short-run Phillips curve.
C)displays a positive relationship rather than an inverse relationship.
D)is exponential.
E)is vertical.

Question

Quizplus · Accepted Answer

The long-run Phillips curve is vertical, indicating that there is no trade-off between inflation and unemployment in the long run. This reflects the idea that in the long run, the economy operates at its natural rate of unemployment, regardless of the inflation rate.

The Long-Run Phillips Curve