The long-run adjustment to a supply shock results in:
A)the short-run aggregate supply curve shifting to the right.
B)the price level rising.
C)unemployment rising.
D)workers being willing to accept higher wages.

Question

Quizplus · Accepted Answer

In the long-run adjustment to a supply shock, the economy tends to stabilize, and one way this happens is through the adjustment of the short-run aggregate supply curve, which shifts to the right as firms adjust their production and prices stabilize. This shift helps the economy return to its long-run equilibrium, where output is at its potential level.

The Long-Run Adjustment to a Supply Shock Results In