Which one of the following newspaper quotations describes a leftward shift of the LAS curve?
A)"The decrease in consumer spending may lead to a recession."
B)"The increase in consumer spending is expected to lead to inflation, without any increase in real GDP."
C)"Recent higher wage settlements are expected to cause higher inflation this year."
D)"Growth has been unusually high the last few years due to more women entering the work force."
E)"The recent tornadoes destroyed many factories in Calgary and Edmonton."

Question

Quizplus · Accepted Answer

A leftward shift of the Long-Run Aggregate Supply (LAS) curve is typically caused by a decrease in the economy's productive capacity, such as the destruction of factories, which reduces the overall supply of goods and services.

Which One of the Following Newspaper Quotations Describes a Leftward