If the production possibilities curve shifts outward, the long-run aggregate supply curve will shift rightward.

Name: If the production possibilities curve shifts outward, the long-run aggregate supply curve will shift rightward.
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Question

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An outward shift in the production possibilities curve indicates an increase in potential output, which will lead to an increase in production and supply in the long run, shifting the long-run aggregate supply curve to the right.

If the Production Possibilities Curve Shifts Outward, the Long-Run Aggregate