According to the hybrid,or consensus,view of aggregate supply,the chance for an aggregate demand increase to cause inflation accelerates as
A)The economy moves away from full employment.
B)Unemployment increases.
C)The slope of aggregate supply becomes flatter.
D)The economy moves toward capacity.

Question

Quizplus · Accepted Answer

The hybrid or consensus view of aggregate supply suggests that as the economy moves toward its capacity or full employment, the chances for an increase in aggregate demand to cause inflation accelerate. This is because, near full capacity, additional demand tends to push prices up rather than increase output.

According to the Hybrid,or Consensus,view of Aggregate Supply,the Chance for an Aggregate