If the full- employment quantity of labor increases, then the
A) LAS curve shifts rightward and the SAS curve does not shift.
B) SAS curve shifts rightward and the LAS curve does not shift.
C) SAS curve shifts rightward and the LAS curve does shifts leftward.
D) SAS curve shifts rightward and the LAS curve shifts rightward.

Question

Quizplus · Accepted Answer

An increase in the full-employment quantity of labor increases the economy's potential output, shifting both the Long-Run Aggregate Supply (LAS) and Short-Run Aggregate Supply (SAS) curves to the right.

If the Full- Employment Quantity of Labor Increases, Then the