Stagflation would be the result of a(n)
A) increase in the economy's aggregate demand curve
B) decrease in the economy's aggregate demand curve
C) decrease in the economy's aggregate supply curve
D) increase in the economy's aggregate supply curve

Question

Quizplus · Accepted Answer

Stagflation is characterized by slow economic growth and high unemployment (stagnation) alongside high inflation. This situation can be caused by a decrease in the economy's aggregate supply curve, as it leads to higher prices for goods and services while production and employment decline.

Stagflation Would Be the Result of A(n)