An increase in short-run aggregate supply is
A) the result of an increase in the price level.
B) represented by a movement from one point to another up along the existing SRAS curve.
C) represented by a rightward shift in the SRAS curve.
D) both a and b
E) both a and C

Question

Quizplus · Accepted Answer

An increase in short-run aggregate supply is represented by a rightward shift in the SRAS curve, indicating that at every price level, a larger quantity of output is produced. It is not the result of an increase in the price level, which would be a movement along the curve (option A) rather than a shift. Option B is also incorrect since a movement from one point to another up along the existing SRAS curve would represent a change in the quantity supplied due to a change in the price level, rather than a change in short-run aggregate supply itself. Option D is incorrect because it includes option B, which we have already established is incorrect. Finally, option E includes the correct choice C, but also includes the incorrect choice A.

An Increase in Short-Run Aggregate Supply Is