With cost-push inflation in the short run, there will be:
A) An increase in real GDP
B) A leftward shift in the aggregate demand curve
C) A decrease real GDP
D) A decrease in unemployment

Question

Quizplus · Accepted Answer

Cost-push inflation occurs when the costs of production increase, leading to a decrease in the aggregate supply. This results in higher prices and a reduction in real GDP in the short run.

With Cost-Push Inflation in the Short Run, There Will Be