From the data in the above table,when the economy is at its short-run equilibrium,if aggregate demand does not change,then as time passes the
A) short-run aggregate supply curve shifts rightward.
B) short-run aggregate supply curve shifts leftward.
C) long-run aggregate supply curve shifts rightward.
D) long-run aggregate supply curve shifts leftward.

Question

Quizplus · Accepted Answer

When the economy is at its short-run equilibrium, if aggregate demand does not change, then over time, the factors of production will adjust to their long-run levels, and the economy will transition to the long-run equilibrium. At the long-run equilibrium, the economy produces at its potential output, and the short-run aggregate supply curve shifts leftward. Therefore, option B is the correct answer.

From the Data in the Above Table,when the Economy Is