In response to the demands of environmentalists, large sections of timberlands are put off limits to logging.What effect will this have on the aggregate supply curve?
A)Shift the curve outward.
B)Shift the curve inward.
C)Move the economy up along the curve.
D)Move the economy down along the curve.

Question

Quizplus · Accepted Answer

Putting large sections of timberlands off limits to logging will decrease the availability of timber, which is a critical input in the production of many goods. This will increase the cost of production, shifting the aggregate supply curve inward.

In Response to the Demands of Environmentalists, Large Sections of Timberlands