Answer to Question #248453 in Macroeconomics for Ndangano

Question

The trade off between unemployment and inflation:
(I) is depicted by the long run philip curve
(Ii)is consistent with money neutrality
(Iii)shows effects of monentary policy in the short run

Answer 1

(I) is depicted by the long run philip curve

When the aggregate demand increases, this decreases unemployment when more workers tend to be hired and the real GDP output as well as price level tend to increase.