Use the figure below to answer the following question(s). Figure 10-4
Starting from long-run equilibrium at point F in Figure 10-4, at which of the following points would short-run equilibrium occur following a decrease in resource prices?
A) I
B) F
C) G
D) H

Question

Use the figure below to answer the following question(s). Figure 10-4
 Starting from long-run equilibrium at point F in Figure 10-4, at which of the following points would short-run equilibrium occur following a decrease in resource prices?
A) I 
B) F 
C) G 
D) H

Quizplus · Accepted Answer

A decrease in resource prices would shift the short-run aggregate supply curve to the right. This would result in a decrease in price level and an increase in output. The only point where this occurs is at point G, where the new short-run equilibrium occurs at a lower price level and a higher level of output.

Use the Figure Below to Answer the Following Question(s)