Secular inflation in the United States since 1960 has been most likely be the result of
A) persistent leftward shifts of the long-run aggregate supply curve.
B) persistent rightward shifts of the long-run aggregate supply curve.
C) persistent rightward shifts of the aggregate demand curve.
D) persistent leftward shifts of the aggregate demand curve.

Question

Quizplus · Accepted Answer

Secular inflation refers to a long-term rise in the general price level. This can be caused by persistent rightward shifts in the aggregate demand curve, leading to an increase in prices even though the economy may be operating at potential output. This can occur due to factors such as an increase in the money supply, increased government spending, or a decrease in taxes that lead to higher consumer demand. Therefore, option C is the most likely reason for secular inflation in the US since 1960.

Secular Inflation in the United States Since 1960 Has Been