Refer to the information provided in Figure 12.3 below to answer the questions that follow. Figure 12.3 -Refer to Figure 12.3.During the 1980s,many firms in the United States were not investing in new capital.This would have caused A)the short-run aggregate supply curve to shift from AS₁ to AS₀. B)the short-run aggregate supply curve to shift from AS₁ to AS₂. C)the economy to move from Point B to Point A along AS₁. D)the economy to move from Point C to Point B along AS₁.

Question

Quizplus · Accepted Answer

A lack of investment in new capital would reduce the productive capacity of the economy, causing the short-run aggregate supply curve to shift leftward from AS₁ to AS₂.

Refer to the Information Provided in Figure 12