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Refer to the Above Diagram

Question 8

Multiple Choice

Refer to the above diagram.The initial aggregate demand curve is AD<sub>1</sub> and the initial aggregate supply curve is AS<sub>1</sub>.Cost-push inflation in the short run is best represented as a: A) leftward shift of the aggregate supply curve from AS<sub>1</sub> to AS<sub>2</sub>. B) rightward shift of the aggregate demand curve from AD<sub>1</sub> to AD<sub>2</sub>. C) move from d to b to a. D) move from d directly to a. Refer to the above diagram.The initial aggregate demand curve is AD1 and the initial aggregate supply curve is AS1.Cost-push inflation in the short run is best represented as a:


A) leftward shift of the aggregate supply curve from AS1 to AS2.
B) rightward shift of the aggregate demand curve from AD1 to AD2.
C) move from d to b to a.
D) move from d directly to a.

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