A positive supply shock from improving technology shifts
A) both the SAS and AD curves rightward.
B) both the SAS and LAS curves leftward.
C) the SAS curve rightward but leaves the LAS curve unchanged.
D) the LAS curve rightward but leaves the SAS curve unchanged.
E) both the SAS and LAS curves rightward.

Question

Quizplus · Accepted Answer

A positive supply shock from improving technology increases the productive capacity of the economy, shifting both the Short-Run Aggregate Supply (SAS) and Long-Run Aggregate Supply (LAS) curves to the right.

A Positive Supply Shock from Improving Technology Shifts