A sudden increase in immigration would be considered a(n):
A) short-run supply shock.
B) long-run supply shock.
C) interest-rate shock.
D) A change in immigration would not affect any of these.

Question

Quizplus · Accepted Answer

A sudden increase in immigration can lead to a long-run supply shock as the labor force increases which can lead to a shift in the production possibility curve and potential output of the economy. This can also lead to changes in wages and prices in the long run.

A Sudden Increase in Immigration Would Be Considered A(n)