Figure 16.1 -Refer to Figure 16.1 to Answer This Question. Suppose the Suppose

Multiple Choice

Figure 16.1
-Refer to Figure 16.1 to answer this question. Suppose the economy is initially at Point A. If labor leaders successfully negotiate a wage increase and the Fed does nothing, then the economy will experience a/n

A) deflation and a recession.
B) deflation and an expansion.
C) inflation and a recession.
D) inflation and an expansion.