The long-run aggregate supply curve is

Refer to Figure 13-1. Ceteris paribus, an increase in firms' expectations of the future profitability of investment spending would be represented by a movement from

A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A.

During the mid and last part of the 1990's both inflation and unemployment were low. In general this could have been the result of

a. adverse supply shocks that shifted the short-run Phillips curve left. b. adverse supply shocks that shifted the short-run Phillips curve right. c. favorable supply shocks that shifted the short-run Phillips curve left. d. favorable supply shocks that shifted the short-run Phillips curve right.