The level of aggregate supply in the long run is not affected by
A)changes in technology.
B)changes in the capital stock.
C)changes in the price level.
D)changes in the number of workers.
E)changes in the availability of natural resources.

Question

Quizplus · Accepted Answer

In the long run, prices adjust to changes in the aggregate demand, and the economy returns to its natural level of output. Therefore, changes in the price level do not affect the level of aggregate supply in the long run. On the other hand, changes in technology, capital stock, number of workers, and availability of natural resources affect the economy's productive capacity and, therefore, the level of aggregate supply in the long run.

The Level of Aggregate Supply in the Long Run Is