The long-run model determines ________ output and ________, while the short-run model determines ________ and ________ inflation.
A) potential; long-run inflation; current output; current
B) potential; unemployment; current output; long-run
C) current; long-run inflation; unemployment; current
D) potential; unemployment; unemployment; current
E) current; unemployment; potential output; current

Question

Quizplus · Accepted Answer

The long-run model determines potential output and long-run inflation, focusing on the economy's capacity and inflation trends over time. The short-run model, on the other hand, determines current output and current inflation, focusing on immediate economic conditions and price changes.

The Long-Run Model Determines ________ Output and ________, While the Short-Run

The Long-Run Model Determines Output and , While the Short-Run