Suppose that the aggregate demand curve and the aggregate supply curve both make simultaneous shifts upward. We can conclude that:
A) the level of aggregate employment falls.
B) the general price level rises and the level of unemployment falls.
C) the general price level rises.
D) the general price level falls and unemployment rises.

Question

Quizplus · Accepted Answer

When both the aggregate demand curve and the aggregate supply curve shift upward, it generally indicates an increase in the general price level due to higher demand and higher costs of production. The specific impact on employment or unemployment is not directly determined by these shifts alone without additional context on the magnitude of the shifts or the state of the economy.

Suppose That the Aggregate Demand Curve and the Aggregate Supply