Other things being equal,if world oil prices increased by 70 percent then the most likely effect would be to:
A) shift the aggregate demand curve right.
B) shift the aggregate supply curve right.
C) shift the aggregate supply curve left.
D) shift the aggregate demand curve right and the aggregate supply curve left.

Question

Quizplus · Accepted Answer

An increase in world oil prices would increase the input costs for producers, leading to a decrease in aggregate supply. This would result in a leftward shift of the aggregate supply curve.

Other Things Being Equal,if World Oil Prices Increased by 70