Which of the following would cause the long- run aggregate supply curve to shift to the right?
A) increases in government regulation
B) higher energy prices
C) an increase in taxes
D) an increase in the labor supply

Question

Quizplus · Accepted Answer

An increase in the labor supply (such as through increases in immigration or higher labor force participation rates) would cause the long-run aggregate supply curve to shift to the right, indicating that the economy is able to produce more output at each price level. Increases in government regulation and taxes would likely hinder business investment and reduce incentives to produce, shifting the curve to the left. Higher energy prices would increase business costs, also shifting the curve to the left.

Which of the Following Would Cause the Long- Run Aggregate