The Short-Run Effect of an Oil Price Increase Is

Multiple Choice

The short-run effect of an oil price increase is

A) an upward shift of the inflation adjustment line and a leftward shift of the aggregate demand curve as the Fed raises interest rates.
B) an upward shift of the inflation adjustment line and a leftward shift of the aggregate demand curve as the Fed lowers the target inflation rate.
C) an upward shift of the inflation adjustment line and a leftward shift of the aggregate demand curve as spending falls.
D) a downward shift of the inflation adjustment line.
E) an upward shift of the inflation adjustment line.