Stagflation can result from
A)a rightward shift of the short- run aggregate supply curve.
B)a rightward shift of the long- run aggregate supply curve.
C)a rightward shift of the demand curve.
D)a leftward shift of the short- run aggregate supply curve.
E)a leftward shift of the demand curve.

Question

Quizplus · Accepted Answer

Stagflation is characterized by high inflation and high unemployment, which typically occurs when the short-run aggregate supply curve shifts to the left. This shift results in higher prices (inflation) and lower output (leading to higher unemployment), fitting the description of stagflation.

Stagflation Can Result from