An increase in the money wage rate shifts the short-run aggregate supply curve ; an increase in technology shifts the long-run aggregate supply curve .
A) leftward; leftward
B) rightward; rightward
C) rightward; leftward
D) leftward; rightward

Question

Quizplus · Accepted Answer

An increase in the money wage rate will increase production costs for firms and shift the short-run aggregate supply curve leftward. On the other hand, an increase in technology will increase productivity and lower production costs in the long-run, shifting the long-run aggregate supply curve rightward.

An Increase in the Money Wage Rate Shifts the Short-Run