Shifts to the right in the long-run aggregate supply curve are the result of

Question

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Shifts to the right in the long-run aggregate supply curve are the result of upward shifts in the production function, which means that firms can produce more output with the same amount of inputs. This can be due to improvements in technology, increases in capital or human capital, or improvements in the efficiency of production. Increases in aggregate demand (B) would cause a shift in the short-run aggregate supply curve, not the long-run aggregate supply curve. Decreases in the supply of labor (C) or reductions in the demand for labor (D) would cause shifts in the short-run aggregate supply curve due to changes in input prices, but would not affect the potential output of the economy in the long run.

Shifts to the Right in the Long-Run Aggregate Supply Curve