If persistent inflation was due to declines in long-run aggregate supply, what pattern would be observed?
A. Only prices of services would increase; prices of goods would remain constant.
B. Increases in the price level would occur simultaneously with increases in real GDP.
C. Only prices of goods would increase; prices of services would remain constant.
D. Increases in the price level would occur simultaneously with decreases in real GDP.
Answer: D
Economics
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