The Economy in 2008
In the first half of June 2008 the effects of a housing and financial crisis and an increase in world prices of oil and foodstuffs were affecting the economy.
-Refer to the Economy in 2008.The effects of increased prices of world commodities is shown by shifting
A)aggregate demand to the right.
B)aggregate demand to the left.
C)aggregate supply to the right.
D)aggregate supply to the left.

Question

Quizplus · Accepted Answer

Increased prices of world commodities like oil and foodstuffs raise production costs, reducing aggregate supply and shifting it to the left.