Which of the following 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 the Following Is a Likely Impact of a Decrease