If Aggregate Demand Increases, Thereby Leading to an Increase in Real

question 14

Multiple Choice

If aggregate demand increases, thereby leading to an increase in real GDP and inflation, there is

• A) a leftward shift in the short-run Phillips curve.
• B) a movement downward along the short-run Phillips curve.
• C) a rightward shift in the short-run Phillips curve.
• D) a movement upward along the short-run Phillips curve.
• E) neither a movement along nor a shift in the short-run Phillips curve.

---

Definitions:

Social Class

A division of a society based on social and economic status.

Postindustrial Society

A society economically dependent upon the production and distribution of services, information, and knowledge.

Agricultural Society

A society that relies on farming and cultivation of the land as the primary source of livelihood and economic activity.

Industrial Society

A society characterized by a reliance on mechanized labor to create goods, leading to urbanization and changes in social structures.