An increase in aggregate demand typically results in a(n) ______ in inflation and a(n) ______ in unemployment in the short run.

An increase in aggregate demand means that people and businesses want to buy more goods and services. When this happens, companies may struggle to keep up with the higher demand, leading them to raise prices, which causes inflation to go up. At the same time, as businesses produce more to meet this demand, they often need to hire more workers, which can lower unemployment. For example, if a popular restaurant sees more customers wanting to dine in, they might increase their menu prices and hire additional staff to serve everyone. Thus, in the short run, an increase in aggregate demand usually leads to higher inflation and lower unemployment.