Use the Figure Below to Answer the Following Questions

question 7

Multiple Choice

Use the figure below to answer the following questions.

Figure 28.1.2
-Refer to Figure 28.1.2.The economy is in long-run equilibrium.If the short-run aggregate supply curve shifts leftward from SAS0 to SAS1,ceteris paribus,then the actual inflation rate

• A)is greater than the expected inflation rate.
• B)is less than the expected inflation rate.
• C)is the same as the expected inflation rate.
• D)cannot be determined without more information.
• E)depends on what happens to wage settlements.