If natural gas is replaced by solar power as a more efficient form of energy, we should expect _____.

Question

Quizplus · Accepted Answer

The replacement of natural gas with solar power is a technological improvement that increases total factor productivity (TFP), which means that output can be produced with fewer inputs. As a result, there is no need for a leftward shift of the aggregate supply curve, higher production prices, a decline in the growth of total output, or a decrease in the stock of energy-efficient capital goods.

If Natural Gas Is Replaced by Solar Power as a More