Suppose there is an increase in the availability of an important major resource, such as oil. Which shift would most likely occur?
A) The aggregate supply would shift right.
B) The aggregate supply would shift left.
C) The aggregate demand would shift right.
D) The aggregate demand would shift left.

Question

Quizplus · Accepted Answer

An increase in the availability of an important major resource such as oil would lead to a decrease in the production costs for firms, which would lead to an increase in supply. Therefore, the aggregate supply curve would shift to the right. Choice C and D are not correct because they relate to changes in demand, which is not affected by supply-side changes.

Suppose There Is an Increase in the Availability of an Important