During the Late 1990s in the United States, Aggregate Demand

Multiple Choice

During the late 1990s in the United States, aggregate demand rose sharply but the price level increased much more slowly. This might be because during this period, firms:

A) were reluctant to increase their markups in the face of higher aggregate demand, causing the short-run aggregate supply curve to be steeper.
B) increased their markups in the face of higher aggregate demand, causing the short-run aggregate supply curve to be steeper.
C) increased their markups in the face of higher aggregate demand, causing the short-run aggregate supply curve to be flatter.
D) were reluctant to increase their markups in the face of higher aggregate demand, causing the short-run aggregate supply curve to be flatter.