An increase in the capital stock would shift the production function _______ and the long-run aggregate supply curve to the _______.

Question

Quizplus · Accepted Answer

An increase in the capital stock would shift the production function upward, indicating more output can be produced with the same amount of inputs. This would shift the long-run aggregate supply curve to the right, indicating an increase in potential output in the economy.

An Increase in the Capital Stock Would Shift the Production