Refer to the Graph Above

Multiple Choice

Refer to the graph above. Assume that the economy is initially at equilibrium at point C, and that the government has adopted a "hands-off" policy approach. If demand-pull inflation occurs, then the final long-run equilibrium point will be point __; while if cost-push inflation occurs (starting at point C) , then the final long-run equilibrium point will be point __.

A) A; C
B) D; B
C) A; A
D) D; A