Aggregate supply increases when:
A)wage rates decrease while the economy's price level remains unchanged.
B)resource availability is reduced.
C)there are fewer workers.
D)there is less capital and the price level remains unchanged.
E)there are increased inflationary expectations of labor.

Question

Quizplus · Accepted Answer

A decrease in wage rates reduces production costs, allowing firms to supply more at the same price level, thus increasing aggregate supply.

Aggregate Supply Increases When