Which of the following could be expected to shift the short-run aggregate supply curve leftward?
A)a new technology for creating cold fusion
B)a discovery of new oil reserves
C)a rise in the price of oil
D)an increase in labour productivity

Question

Quizplus · Accepted Answer

A rise in the price of oil would increase production costs for firms, leading to a decrease in short-run aggregate supply. A new technology for creating cold fusion or an increase in labour productivity would increase short-run aggregate supply, shifting the curve rightward. The discovery of new oil reserves could potentially increase short-run aggregate supply, but it depends on the magnitude of the reserves and the extent to which they affect production costs. Therefore, option C is the best choice for a leftward shift in the short-run aggregate supply curve.

Which of the Following Could Be Expected to Shift the Short-Run