Which one of the following newspaper quotations describes a shift of only the SAS curve?
A)"The recent tornadoes destroyed many factories in Calgary and Edmonton."
B)"The decrease in consumer spending may lead to a recession."
C)"Recent higher wage settlements are expected to cause higher inflation this year."
D)"Growth has been unusually high the last few years due to more women entering the work force."
E)"The increase in consumer spending is expected to lead to inflation, without any increase in real GDP."

Question

Quizplus · Accepted Answer

This quotation specifically references a shift in the SAS curve, as wage settlements are a factor that can cause a shift in the short-run aggregate supply. The other quotations may reference shifts in aggregate demand or long-run aggregate supply.

Which One of the Following Newspaper Quotations Describes a Shift