An increase in the level of technology shifts
A) the LAS curve rightward but leaves the SAS curve unchanged.
B) the SAS curve rightward but leaves the LAS unchanged.
C) both the SAS and LAS curves leftward.
D) both the SAS and LAS curves rightward.

Question

Quizplus · Accepted Answer

An increase in the level of technology improves productivity, which increases potential output, shifting both the Long-Run Aggregate Supply (LAS) and Short-Run Aggregate Supply (SAS) curves to the right.

An Increase in the Level of Technology Shifts