Which of the following will shift the domestic SAS curve up?
A)Lowering wages
B)Increasing unemployment insurance
C)Increasing productivity by retraining
D)Reducing unemployment insurance

Question

Quizplus · Accepted Answer

Increasing unemployment insurance can lead to higher labor costs for employers, as it might reduce the incentive for individuals to quickly return to work, potentially leading to higher wages to attract workers. This can shift the short-run aggregate supply (SAS) curve upwards, indicating a decrease in the total supply of goods and services at every price level due to increased production costs.

Which of the Following Will Shift the Domestic SAS Curve