Use the Following to Answer Questions

Multiple Choice

Use the following to answer questions
Exhibit: Economic Adjustments
-(Exhibit: Economic Adjustments)
Suppose the economy is at point a.Assume that (1)
The public's expectations are completely rational; (2)
Markets allocate resources instantaneously; and (3)
The economy is at its natural level of employment.The theoretical adjustment path resulting from an increase in aggregate demand according to the rational expectations hypothesis is

A) a to c to d.
B) a to b to d.
C) a to d.
D) a to b and back to a.