Which of the following would shift the SRAS curve but NOT the LRAS curve?
A)increasing the available quantity of available natural resources
B)increasing the level of usable technology
C)increasing the wage rate paid to labour
D)increasing the capital stock

Question

Quizplus · Accepted Answer

Increasing the wage rate paid to labour would affect the short-run aggregate supply (SRAS) curve because it would increase the cost of production for firms, leading to a decrease in the quantity of output supplied at any given price level. However, it would not impact the long-run aggregate supply (LRAS) curve because the wage rate is a nominal variable that does not affect the economy's potential output in the long run. The other options (A, B, and D) would all shift both the SRAS and LRAS curves because they would impact the economy's capacity to produce goods and services in the long run.

Which of the Following Would Shift the SRAS Curve but NOT