When there is a cost-push inflation
A) workers demand higher money wages because of higher price levels.
B) the short-run aggregate supply curve shifts rightward.
C) the aggregate demand curve shifts leftward because of the cost hikes.
D) None of the above answers is correct.

Question

Quizplus · Accepted Answer

Cost-push inflation occurs when the costs of production increase, leading to higher prices. As a result, workers may demand higher wages to maintain their purchasing power.

When There Is a Cost-Push Inflation