Refer to the Diagram $\mathrm { AS } _ { 2 }$

Multiple Choice

Refer to the diagram. Assume that nominal wages initially are set based on the price level P₂ and that the economy initially is operating at its full-employment level of output Q_f. In the long run, demand-pull inflation could best be shown as

A) a move from b to c on A $\mathrm { AS } _ { 2 }$
B) a move from b to f to d.
C) a change of aggregate supply from A $\mathrm { AS } _ { 2 } \text { to } \mathrm { AS } _ { 1 }$
D) a move from b to d.