If Demand Pull Inflation Occurs When the Economy Is Already

question 191

Multiple Choice

If demand pull inflation occurs when the economy is already at potential GDP, then following the initial increase in aggregate demand, the

• A) SAS curve shifts rightward.
• B) LAS curve shifts rightward.
• C) SAS curve shifts leftward.
• D) LAS curve shifts leftward.

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Definitions:

Behaviorism

A branch of psychology that studies observable behaviors, emphasizing the role of environmental factors in shaping behavior.

Cognitive Development

Refers to the progressive and ongoing growth of perception, memory, imagination, and problem-solving skills.

Concrete Operational

A stage in Piaget's theory of cognitive development, occurring roughly between the ages of 7 and 12, during which children gain the ability to think logically about concrete events.

Sensorimotor

Referring to a developmental stage in children characterized by the coordination of sensory experiences with motor actions.