As the slope of the aggregate supply curve increases, this indicates that
A)the economy is getting close to potential GDP.
B)the economy is reducing employment.
C)inflation will be less of a problem.
D)output is falling.

Question

Quizplus · Accepted Answer

An increase in the slope of the aggregate supply curve indicates that it becomes relatively more difficult to increase output, suggesting that the economy is approaching or reaching its potential output, also known as potential GDP.

As the Slope of the Aggregate Supply Curve Increases, This