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
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Indicate whether the statement is true or false
The transmission mechanism is the effect of changes in monetary policy on prices, real GDP, and employment
a. True b. False Indicate whether the statement is true or false
On a Phillips curve diagram, an increase in the rate of inflation, other things being equal, is represented by a(n):
a. upward movement along the Phillips curve. b. downward movement along the Phillips curve. c. upward shift of the Phillips curve. d. downward shift of the Phillips curve.