Figure 9-2

-Refer to Figure 9-2.What would a shift from AD₀ to AD₁ indicate?
A)cost-push inflation
B)increasing SRAS
C)decreasing real GDP
D)increasing aggregate demand

Question

Figure 9-2
 
-Refer to Figure 9-2.What would a shift from AD₀ to AD₁ indicate?
A)cost-push inflation 
B)increasing SRAS 
C)decreasing real GDP 
D)increasing aggregate demand

Quizplus · Accepted Answer

A shift from AD₀ to AD₁ indicates an increase in aggregate demand, which would lead to an increase in both prices and real GDP. Cost-push inflation and decreasing real GDP would result in a leftward shift of the AD curve, while increasing SRAS would result in a rightward shift of the SRAS curve.

Figure 9-2 -Refer to Figure 9-2.What Would a Shift from AD₀ to Shift