Which of the following is most likely to increase aggregate supply?

Question

Quizplus · Accepted Answer

A decrease in the capital gains tax would lead to an increase in investment, which would increase the capital stock and lead to an increase in aggregate supply. None of the other options would directly increase aggregate supply. In fact, an increase in safety regulations or the minimum wage could decrease aggregate supply by increasing costs for firms. An increase in government borrowing would increase aggregate demand, not supply.

Which of the Following Is Most Likely to Increase Aggregate