If the short-run aggregate supply curve is shifting down repeatedly,it is rather likely that ________.
A)output is declining repeatedly,relative to potential output
B)the long-run aggregate supply curve is shifting to the left
C)negative price shocks are recurring
D)all of the above
E)none of the above

Question

Quizplus · Accepted Answer

A downward shift in the short-run aggregate supply curve typically indicates that production costs are decreasing or productivity is increasing, leading to higher output at each price level, not declining output or recurring negative price shocks.

If the Short-Run Aggregate Supply Curve Is Shifting Down Repeatedly,it