If the Economy Is Experiencing an Inflationary Output Gap,the Adjustment

Multiple Choice

If the economy is experiencing an inflationary output gap,the adjustment process operates as follows:

A) Wages do not adjust,but the AD curve shifts to the right.
B) Wages fall,unit costs fall,and the AD curve shifts rightward.
C) Wages rise,unit costs rise,and the AS curve shifts leftward.
D) Wages rise,unit costs rise,and the AS curve shifts rightward.
E) Wages fall,unit costs fall,and the AS curve shifts rightward.