Figure 22-8

Multiple Choice

Figure 22-8. The left-hand graph shows a short-run aggregate-supply (SRAS) curve and two aggregate-demand (AD) curves. On the right-hand diagram, "Inf Rate" means "Inflation Rate."
-Refer to Figure 22-8. Subsequent to the shift of the Phillips curve from PC₁ to PC₂, the curve will soon shift back to PC₁ if people perceive the

A) increase in the inflation rate as a temporary aberration.
B) economic boom as a temporary aberration.
C) increase in the inflation rate as a sign of a new era of higher inflation.
D) economic boom as a sign of a new era of higher economic growth.