What effect will the combination of a technological advance and a better-trained and educated workforce have on LRAS?
A)It will shift LRAS to the left.
B)It will have an indeterminate effect on LRAS.
C)It will shift LRAS to the right.
D)It will leave LRAS unchanged.

Question

Quizplus · Accepted Answer

A technological advance and a better-trained and educated workforce lead to an increase in productivity, which will shift LRAS to the right. This is because with improved technology and skills, firms can produce more output with the same amount of inputs, resulting in an increase in potential output.

What Effect Will the Combination of a Technological Advance and a Better-Trained