-Refer to the above diagram.If aggregate supply shifts from AS₁ to AS₃,then real domestic output will: A) increase and the price level will increase. B) increase and the price level will decrease. C) decrease and the price level will increase. D) decrease and the price level will decrease.

Question

Quizplus · Accepted Answer

When aggregate supply shifts from AS1 to AS3, it indicates an increase in aggregate supply. This typically leads to an increase in real domestic output and a decrease in the price level, as more goods and services are available at lower prices.

-Refer to the Above Diagram