The AS curve slopes upward because:
A) all firms will increase their prices in response to an increase in aggregate demand, but some will increase their output and other will decrease their output.
B) all firms will increase their prices, but not their output in response to an increase in aggregate demand.
C) some firms will increase their prices and their output in response to an increase in aggregate demand.
D) all firms will increase their prices and their output in response to an increase in aggregate demand.

Question

Quizplus · Accepted Answer

Some firms respond to increased aggregate demand by raising both prices and output, leading to an upward-sloping AS curve.

The AS Curve Slopes Upward Because