Suppose that the discovery of cold fusion implies that the productivity of each worker in the economy doubles.This would cause the
A)AD curve to shift up and the SAS curve to remain stationary.
B)SAS curve to shift rightward.
C)SAS curve to shift leftward.
D)AD curve to shift down and the SAS curve to shift upward.

Question

Quizplus · Accepted Answer

The discovery of cold fusion, leading to a doubling of worker productivity, would increase the aggregate supply of goods and services in the economy. This is represented by a rightward shift of the Short-Run Aggregate Supply (SAS) curve, indicating that at every price level, more goods and services can be produced due to the increased productivity.

Suppose That the Discovery of Cold Fusion Implies That the Productivity