Price Stability Is Represented by Points on the Long-Run Aggregate

question 13

True/False

Price stability is represented by points on the long-run aggregate supply curve (LAS).

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Definitions:

Unemployment

The situation when individuals who are capable of working and willing to work are unable to find employment.

Long-run Phillips Curve

An economic concept stating that in the long run, there is no trade-off between inflation and unemployment; the curve is vertical at the natural rate of unemployment.

Inflation

How rapidly the across-the-board prices of goods and services increase, impairing fiscal buying ability.

Unemployment

Unemployment occurs when individuals who are capable of working and are looking for a job are unable to find employment. It is a key economic indicator.