Figure 9.5 -Refer to Figure 9.5. Suppose the economy is a point B. A large in the price of crude oil leads to a shift from _______ to _______. A) increase; AS¹; AS⁰ B) increase; AS¹; AS² C) decrease; AS²; AS¹ D) increase; AS²; AS¹

Question

Quizplus · Accepted Answer

A large increase in the price of crude oil will lead to an increase in the cost of production for many firms, which will shift the aggregate supply curve to the left, from AS⁰ to AS¹.

Figure 9.5 -Refer to Figure 9.5. Suppose the Economy Is a Point