If demand pull inflation occurs when the economy is already at ...

[renzo156]

If demand pull inflation occurs when the economy is already at potential GDP, then following the initial increase in aggregate demand, the
 
  A) AS curve shifts rightward.
  B) potential GDP line shifts rightward.
  C) AS curve shifts leftward.
  D) potential GDP line shifts leftward.
  E) None of the above is correct because demand-pull inflation shifts only the aggregate demand curve.

Question 2

A technological change ________ and a change in the capital stock ________.
 
  A) shifts the productivity curve; shifts the productivity curve
  B) shifts the productivity curve; creates a movement along the productivity curve
  C) creates a movement along the productivity curve; shifts the productivity curve
  D) does not change the productivity curve; creates a movement along the productivity curve
  E) does not change the productivity curve; shifts the productivity curve

[Viet Thy]

Answer to Question 1

C

Answer to Question 2

B