Figure 17.7
-Suppose that the economy is at point A on the Phillips curve in Figure 17.7.If the aggregate demand curve shifts to the right by less than the long-run aggregate supply,then the economy will
A) remain at point A on the Phillips curve.
B) move to point B on the Phillips curve.
C) move to point C on the Phillips curve.
D) move to point D on the Phillips curve.

Question

Figure 17.7 
-Suppose that the economy is at point A on the Phillips curve in Figure 17.7.If the aggregate demand curve shifts to the right by less than the long-run aggregate supply,then the economy will
A) remain at point A on the Phillips curve. 
B) move to point B on the Phillips curve. 
C) move to point C on the Phillips curve. 
D) move to point D on the Phillips curve.

Quizplus · Accepted Answer

If aggregate demand increases by less than the long-run aggregate supply, the economy will experience lower inflation and higher unemployment, moving to a point like C on the Phillips curve.

Figure 17.7 -Suppose That the Economy Is at Point a on the a on the Phillips