The price level rises more rapidly as the maximum output level is approached along an aggregate supply curve because

A) profit-taking firms are exploiting their market size and power.
B) of the profit incentive.
C) the costs of additional units of aggregate output begin to rise more rapidly,causing firms to seek higher prices to cover these rising costs.
D) None of the choices are correct.

As the economy approaches its maximum output level, the costs of additional units of aggregate output inevitably begin to rise more rapidly. This could be due to factors such as shortages of raw materials, limitations on the availability of skilled labor, and/or constraints on the availability of capital. As firms encounter these increasing costs, they may seek higher prices in order to offset them and maintain their profitability. This results in an upward shift of the aggregate supply curve and a corresponding increase in the price level.