Which of these is a likely impact of a decrease in the price level in an economy on the aggregate supply in the economy?
A)An increase in the quantity of real GDP supplied
B)A decrease in the quantity of real GDP supplied
C)A leftward shift of the aggregate supply curve
D)A rightward shift of the aggregate supply curve
E)An increase in the slope of the aggregate supply curve

Question

Quizplus · Accepted Answer

A decrease in the price level in an economy typically leads to a decrease in the quantity of real GDP supplied because producers are less willing to supply goods and services at lower prices. This is a movement along the aggregate supply curve, not a shift of the curve itself.

Which of These Is a Likely Impact of a Decrease