Refer to the Above Graph

question 42

Multiple Choice

Refer to the above graph.Assume the economy is at the initial position of B₁.An increase in aggregate demand will tend to:

• A)temporarily shift the economy to point B₂.
• B)temporarily shift the economy to point C₁.
• C)permanently shift the economy to point C₁.
• D)have no effect in shifting the economy from point B₁.