A change in the price of resources will cause:

Question

Quizplus · Accepted Answer

A change in the price of resources will cause a shift in the positively sloped portion of the aggregate supply curve. This is because an increase in the price of resources will increase the costs of production and decrease the profitability of producing goods and services, leading to a decrease in output and a shift of the aggregate supply curve to the left. Conversely, a decrease in the price of resources will decrease the costs of production and increase the profitability of producing goods and services, leading to an increase in output and a shift of the aggregate supply curve to the right. This is shown in the graph below:

![aggregate supply curve shift](https://www.economicshelp.org/wp-content/uploads/2012/07/as-curve-shfit.gif)

A Change in the Price of Resources Will Cause