What causes the long-run aggregate supply curve to shift right?
A) economic growth
B) inflation
C) unemployment
D) scarcity

Question

Quizplus · Accepted Answer

Economic growth leads to an increase in the production capacity of an economy, which causes the long-run aggregate supply curve to shift right. This is because, with growth, there is an increase in the availability of factors of production such as labor and capital, as well as improvements in technology and productivity. These factors allow firms to produce more goods and services at lower costs, thus increasing the potential output of the economy in the long run.

What Causes the Long-Run Aggregate Supply Curve to Shift Right