Along the long-run aggregate supply curve, the level of RGDP supplied ____ with increases in the price level.
A)does not change
B)increases
C)decreases slightly
D)decreases dramatically

Question

Along the long-run aggregate supply curve, the level of RGDP supplied ____ with increases in the price level.
A)​does not change
B)​increases
C)​decreases slightly
D)​decreases dramatically

Quizplus · Accepted Answer

Along the long-run aggregate supply curve, the level of RGDP supplied is not affected by changes in the price level, as it is determined by factors such as the availability of resources, technology, and the overall level of productivity in the economy, which are not influenced by changes in prices. The long-run aggregate supply curve is therefore depicted as a vertical line representing a constant potential output level at full employment.

Along the Long-Run Aggregate Supply Curve, the Level of RGDP