-Refer to Exhibit 17-3 Assume that the starting point on the production function is point A.After an increase in the quantity of labor,there would be a ______________________ which would shift the LRAS curve from LRAS₁ to _______________ resulting in _______________.. A) movement along the production function to point C; LRAS₂; economic growth B) shifting upward of the production function to point B; LRAS₂; economic growth C) movement along the production function to point C; LRAS₃; a shrinking economy D) shifting upward of the production function to point B; LRAS₃; a shrinking economy

Question

Quizplus · Accepted Answer

An increase in the quantity of labor leads to a movement along the production function (not a shift), indicating an increase in output, which is associated with economic growth. This results in the LRAS curve shifting to reflect the economy's increased capacity to produce.

-Refer to Exhibit 17-3 Assume That the Starting Point on the Production