If there is a change in the U.S. endowment of factors of production, then there would be
A) a shift in just LRAS.
B) a shift in both LRAS and SRAS.
C) shifts in just SRAS.
D) a movement along the SRAS curve.

Question

Quizplus · Accepted Answer

A change in the U.S. endowment of factors of production would affect the economy's productive capacity in both the short and the long run. In the short run, there might be a reallocation of resources among sectors, causing a shift in the short-run aggregate supply (SRAS) curve. In the long run, the economy would adjust to the new endowment level, leading to a shift in the long-run aggregate supply (LRAS) curve. Therefore, both the SRAS and LRAS curves would shift.

If There Is a Change in the U