An increase in a nation's education level would cause the _______ aggregate supply curve to shift to the _______.
A) long-run; right
B) long-run; left
C) short-run; left
D) short-run; right

Question

Quizplus · Accepted Answer

An increase in a nation's education level would take time to manifest in the economy as a higher level of productivity and efficiency. Hence, its impact would be more prevalent in the long run than in the short run. This increase in productivity would lead to an increase in potential output, shifting the long-run aggregate supply curve to the right.

An Increase in a Nation's Education Level Would Cause the _______