What would cause the price level to decrease and employment to increase?
A) a shift to the left of the aggregate demand curve
B) a shift to the right of the aggregate demand curve
C) a shift to the left of the short-run aggregate supply curve
D) a shift to the right of the short-run aggregate supply curve

Question

Quizplus · Accepted Answer

A shift to the right of the short-run aggregate supply curve would cause prices to decrease and employment to increase. This is because as the supply of goods and services increases, prices will decrease and firms will need to hire more workers to produce the additional output.

What Would Cause the Price Level to Decrease and Employment