Which of the following statements is true when considering an economy with anupward-sloping short-run aggregate supplycurve?

A.

The multiplier has its full effect no matter what the economy is experiencing.

B.

The multiplier has an equal but muffled impact when there is either a recessionary or inflationary gap.

C.

The multiplier has more impact when the economy is experiencing an inflationary gap compared to a recessionary gap.

D.

The multiplier has more impact when the economy is experiencing a recessionary gap compared to an inflationary gap.

The multiplier is weakened in inflationary gaps because of

A.

increasing returns.

B.

rapid price level increases.

C.

economies of scale.

D.

incomes rising faster than the price level.