Use the Following to Answer Questions

Multiple Choice

Use the following to answer questions .
Exhibit: Shifts in Aggregate Demand and Aggregate Supply and Inflation-Unemployment Phases
-(Exhibit: Shifts in Aggregate Demand and Aggregate Supply and Inflation-Unemployment Phases) The recessionary gap at point 4 was created

A) during the Phillips phase that occurred when the economy moved from point 3 to point 4.
B) when policymakers pursued expansionary policies to move the economy from point 3 to point 4.
C) during the stagflation phase that occurred when the economy moved from point 3 to point 4.
D) during the recovery phase when economic agents revised their price expectations in higher prices.