________ would decrease short-run aggregate supply.
A) A negative supply shock
B) Menu costs
C) Money illusion
D) A technological advance
E) A lower than expected price level

Question

Quizplus · Accepted Answer

A negative supply shock, such as an increase in oil prices or a natural disaster disrupting production, would decrease the availability of resources and increase the cost of production, leading to a decrease in short-run aggregate supply. The other options listed would not necessarily decrease short-run aggregate supply.

________ Would Decrease Short-Run Aggregate Supply