Refer to the Given Figure

question 115

Multiple Choice

Refer to the given figure. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as:

• A)aggregate demand shifting rightward.
• B)aggregate demand shifting leftward.
• C)short-run aggregate supply shifting downward.
• D)long-run aggregate supply shifting leftward.