Give examples of factors that decrease aggregate supply. Which way does the AS curve shift?
What will be an ideal response?
Aggregate supply decreases if potential GDP decreases. A rise in the money wage rate or the money price of other resources such as the price of oil raises firms' costs and decreases aggregate supply. The AS curve shifts leftward.
Economics
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The demand for money curve is negatively sloped because people tend to hold less money at lower interest rates.
a. true b. false
Economics
If income rises by 10 percent and the quantity sold of a particular vehicle falls by 7 percent, then this particular type of vehicle is
A. An inferior good. B. A normal good. C. An irregular good. D. A substandard good.
Economics