Figure 24-2
-Refer to Figure 24-2.Ceteris paribus,a decrease in productivity would be represented by a movement from
A)SRAS1 to SRAS2.
B)SRAS2 to SRAS1.
C)point A to point B.
D)point B to point A.

Question

Figure 24-2 
-Refer to Figure 24-2.Ceteris paribus,a decrease in productivity would be represented by a movement from
A)SRAS1 to SRAS2. 
B)SRAS2 to SRAS1. 
C)point A to point B. 
D)point B to point A.

Quizplus · Accepted Answer

A decrease in productivity will lead to an increase in production costs for firms, resulting in a decrease in aggregate supply. This shift in aggregate supply would be represented by a movement from SRAS2 to SRAS1. Therefore, choice B is the correct answer.

Figure 24-2 -Refer to Figure 24-2.Ceteris Paribus,a Decrease in Productivity Would Be