Consider the following statement: "President Carter expressed concern about reports of rising inflation but insisted the economy is on the right course. He pointed to recent reductions in unemployment as evidence that his economic policies are working." Which of the following could have caused this phenomenon?

a. Increase in government spending that shifted the aggregate demand

curve to the right.

b. Increase in money supply which lowered interest rates and shifted the

short-run aggregate supply curve to the right.

c. Economic agents revising their expectations about the price level

resulting in the short-run aggregate supply curve shifting to the left.

d. Expansionary ????scal and monetary policies that shifted the long-run

aggregate supply curve to the right.