According to the New Classical Theory,if the Public Correctly Anticipates

Multiple Choice

According to the new classical theory,if the public correctly anticipates a government policy to increase aggregate demand,then

A) there will be a short-run tradeoff between inflation and unemployment,but there will not be a long-run tradeoff.
B) there will be a long-run tradeoff between inflation and unemployment,but there will not be a short-run tradeoff.
C) there will be both a long-run and a short-run tradeoff between inflation and unemployment.
D) there will be neither a long-run nor a short-run tradeoff between inflation and unemployment.
E) there may be a short-run tradeoff between inflation and unemployment,but one cannot say for certain whether there will be a long-run tradeoff.