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Monetarists argue that in the long run there is no Philip curve trade-off as Long Run AS is inelastic. If there is an increase in aggregate demand, then workers demand higher nominal wages. When they receive higher nominal wages, they work longer hours because they feel real wages have increased. (their price expectations are based on last year). However, this increase in AD causes inflation, and therefore, real wages stay the same. When they realise real wages are the same as last year, they change their price expectations, and no longer supply extra labour and the real output returns to its original level. Therefore, unemployment remains unchanged, but we have a higher inflation rate. Hence in long run, the Philip curve is vertical.
Which state in the 'Landlocked Group' category showed the lowest logistics performance in the LEADS 2024 report?
22nd Summit of the SCO Council hosted by which ministry ?
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Where is the capital of Switzerland?
Match the following:
What is the chemical formula of “Chalk”?
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According to a joint report by India Cellular & Electronics Association (ICEA) and Accenture, what is the estimated revenue potential that circular busi...
Consider the following in regards to Kumaon Commissionary during British rule:
1. Almora Jail was established in 1916
2. Pauri Jail was es...