What shifts the short-run aggregate supply (SAS) curve but not the long-run aggregate supply (LAS) curve?
A) a change in input prices.
B) a change in the quantity of capital.
C) an improved technology.
D) an increase in population.
E) none of the above.

Question

Quizplus · Accepted Answer

Changes in input prices, such as an increase in the cost of labor or raw materials, will cause a shift in the short-run aggregate supply curve as firms adjust their production levels in response to the change in costs. However, in the long run, firms will have time to adjust their capital and technology levels, and the aggregate supply curve will shift back to the original position.

What Shifts the Short-Run Aggregate Supply (SAS) Curve but Not