Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:Price Level
aa
P₁
0
AD₁
AD₂
Q₁ Q2 Q3
Real Domestic Output
1
Refer to the figure above. A shift from AD ₁ shifts to AD 2 would be consistent with what
economic event in U.S. history?
Demand-pull inflation in the late 1960s
Cost-push inflation in the mid-1970s
Full-employment in the late 1990s
Recession in 2007-09
AS
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