Exhibit 14-3 Aggregate supply and demand curves

-A shift in the aggregate supply curve in Exhibit 14-3 from AS₁ to AS₂ would be caused by a(n):
A) increase in consumer spending.
B) increase in input prices.
C) decrease in input prices.
D) decrease in real output.

Question

Exhibit 14-3 Aggregate supply and demand curves
 
-A shift in the aggregate supply curve in Exhibit 14-3 from AS₁ to AS₂ would be caused by a(n):
A) increase in consumer spending. 
B) increase in input prices. 
C) decrease in input prices. 
D) decrease in real output.

Quizplus · Accepted Answer

A shift from AS₁ to AS₂ indicates an increase in aggregate supply, which can be caused by a decrease in input prices, making production cheaper and increasing supply.

Exhibit 14-3 Aggregate Supply and Demand Curves