Which of the following would shift the LRAS curve to the right?
A)a decline in the length of the average workweek
B)an improvement in technology
C)a drought
D)an increase in aggregate demand
E)an increase in the minimum wage

Question

Quizplus · Accepted Answer

An improvement in technology would increase productivity and efficiency, leading to an increase in potential output and shifting the LRAS curve to the right. A decline in the average workweek (choice A) would decrease output and shift the LRAS curve to the left. A drought (choice C) would reduce the availability of natural resources and could cause a leftward shift in the LRAS curve. An increase in aggregate demand (choice D) would cause the SRAS curve to shift to the right, but would not affect the LRAS curve. An increase in the minimum wage (choice E) would increase production costs and reduce profitability, leading to a leftward shift in the SRAS curve and potentially the LRAS curve in the long run.

Which of the Following Would Shift the LRAS Curve to the Right