If the price level were to rise,the short-run aggregate supply curve in the next period will
A)shift upward.
B)shift downward.
C)become steeper.
D)None of the above is correct.

Question

Quizplus · Accepted Answer

The short-run aggregate supply curve (SRAS) does not shift upward or downward nor does it become steeper simply because the price level rises. Instead, movements along the SRAS curve occur in response to changes in the price level, not shifts of the entire curve. Shifts in the SRAS curve are caused by changes in the costs of production, productivity, or expectations, not by changes in the price level itself.

If the Price Level Were to Rise,the Short-Run Aggregate Supply