Graphically, demand-pull inflation is shown as a
A)rightward shift of the AD curve along an upsloping AS curve.
B)leftward shift of the AS curve along a downsloping AD curve.
C)leftward shift of the AS curve along an upsloping AD curve.
D)rightward shift of the AD curve along a downsloping AS curve.

Question

Quizplus · Accepted Answer

Demand-pull inflation occurs when aggregate demand increases, causing the aggregate demand (AD) curve to shift rightward along the upward-sloping aggregate supply (AS) curve, leading to higher price levels.

Graphically, Demand-Pull Inflation Is Shown as a