-The change in potential real GDP and aggregate supply shown in the graph above can be a result of
A)an increase in the real wage rate.
B)an increase in the quantity of capital.
C)a decrease in the money wage rate.
D)a decrease in the money price of oil.
E)a fall in the price level.

Question

-The change in potential real GDP and aggregate supply shown in the graph above can be a result of
A)an increase in the real wage rate. 
B)an increase in the quantity of capital. 
C)a decrease in the money wage rate. 
D)a decrease in the money price of oil. 
E)a fall in the price level.

Quizplus · Accepted Answer

An increase in the quantity of capital can lead to an increase in potential real GDP and aggregate supply, as it enhances the productive capacity of the economy.

-The Change in Potential Real GDP and Aggregate Supply Shown