The long-run aggregate supply curve will shift to the right if the:
A) potential output of the economy expands.
B) economy loses productive capacity.
C) economy experiences a supply shock.
D) profit levels of firms increase.

Question

Quizplus · Accepted Answer

The long-run aggregate supply curve represents the potential output of an economy, so if potential output expands, the long-run aggregate supply curve will shift to the right. The other choices do not align with the concept of a long-run aggregate supply curve.

The Long-Run Aggregate Supply Curve Will Shift to the Right