The short-run aggregate supply curve shifts when
i. the full-employment quantity of capital changes.
ii. technology advances.
A) neither i nor ii
B) i only
C) ii only
D) i and ii

Question

Quizplus · Accepted Answer

Both the full-employment quantity of capital and advancements in technology can shift the short-run aggregate supply curve. An increase in capital or technological improvements typically increase productivity, shifting the curve to the right.

The Short-Run Aggregate Supply Curve Shifts When