Refer to the figure below. 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. long-run aggregate supply shifting leftward
B. Short-run aggregate supply shifting upward
C. Short-run aggregate supply shifting downward
D. Aggregate demand shifting leftward
Answer: B
You might also like to view...
If the marginal propensity to consume (MPC) is 0.75 and government purchases increase by $200 billion, then
A) equilibrium real Gross Domestic Product (GDP) will increase by $50 billion. B) the effect on equilibrium real Gross Domestic Product (GDP) cannot be determined from the given information. C) equilibrium real Gross Domestic Product (GDP) will increase by $800 billion. D) equilibrium real Gross Domestic Product (GDP) will increase by $200 billion.
Which of the following is most likely produced in a monopolistically competitive market?
a. soybeans b. autos c. fast food d. oil e. local phone service