In which situation would the long-run aggregate-supply curve shift right?
A) if the minimum wage increases
B) if the capital stock decreases
C) if interest rates increase
D) if technology advances

Question

Quizplus · Accepted Answer

Technological advances increase productivity and efficiency, thus leading to an increase in potential output and shifting the long-run aggregate-supply curve to the right. The other options would shift the curve to the left, as they either increase costs (minimum wage) or decrease productive capacity (capital stock) or discourage investment (interest rates).

In Which Situation Would the Long-Run Aggregate-Supply Curve Shift Right