The short-run aggregate supply curve will shift to the left if:
A) the aggregate price level falls.
B) commodity prices rise.
C) tax revenues fall.
D) productivity increases.

Question

Quizplus · Accepted Answer

The short-run aggregate supply curve shifts to the left if the cost of production increases, which can happen if commodity prices rise. This makes production more expensive at every output level, thus reducing the quantity of goods and services supplied at any given price level.

The Short-Run Aggregate Supply Curve Will Shift to the Left