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Use the Following to Answer Questions

Question 68

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Use the following to answer questions
Exhibit: Aggregate Production Function, Labor Market, and LRAS Use the following to answer questions Exhibit: Aggregate Production Function, Labor Market, and LRAS -(Exhibit: Aggregate Production Function, Labor Market, and LRAS) If a change in technology moves the aggregate production function in Panel (a) Upwards, what happens to the economy's potential output? A) Potential output remains unchanged. B) Potential output increases. C) Potential output decreases. D) Potential output could increase or decrease depending on what happens in the labor market.
-(Exhibit: Aggregate Production Function, Labor Market, and LRAS)
If a change in technology moves the aggregate production function in Panel (a)
Upwards, what happens to the economy's potential output?


A) Potential output remains unchanged.
B) Potential output increases.
C) Potential output decreases.
D) Potential output could increase or decrease depending on what happens in the labor market.

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