If the aggregate demand curve shifts____________faster than the long -run aggregate supply curve, then ____________occurs.
A) rightward; economic growth
B) leftward; economic growth
C) rightward; inflation
D) leftward; inflation

Question

Quizplus · Accepted Answer

If the aggregate demand curve shifts rightward faster than the long-run aggregate supply curve, it creates an excess demand for goods and services, leading to an increase in the price level, which is inflation. Economic growth occurs when the aggregate demand curve shifts rightward at a similar pace to the long-run aggregate supply curve.

If the Aggregate Demand Curve Shifts____________faster Than the Long -Run