When an economy self-corrects from a recession or inflation, the _____ shifts to move output to the natural rate of output.
A) aggregate demand curve
B) long-run aggregate supply curve
C) aggregate natural output curve
D) short-run aggregate supply curve

Question

Quizplus · Accepted Answer

The short-run aggregate supply curve shifts to move output to the natural rate of output as part of the economy's self-correction mechanism from a recession or inflation. This adjustment process helps to bring the economy back to its long-run equilibrium without the need for policy intervention.

When an Economy Self-Corrects from a Recession or Inflation, the _____