-Refer to Figure 13.9. In panel b) of the diagram the shift from AS₀ to AS₁ has created:

Name: -Refer to Figure 13.9. In panel b) of the diagram the shift from AS 0 to AS 1 has created:
Brand: Quizplus
Rating: 4.7 (59 reviews)

Question

Quizplus · Accepted Answer

The shift from AS₀ to AS₁ in an economic diagram typically represents an increase in aggregate supply, leading to an inflationary gap. This gap occurs when the actual output exceeds the potential output, putting upward pressure on prices and wages as demand for goods and labor increases.