Aggregate demand and aggregate supply

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Question 17
Easy

The diagram below shows a shift in an economy's short-run aggregate supply curve from SRAS1\text{SRAS}_1SRAS1​ to SRAS2\text{SRAS}_2SRAS2​, while its classical long-run aggregate supply curve (LRAS\text{LRAS}LRAS) remains unchanged at the full-employment level of output, YfY_fYf​.

Aggregate supply shift

Which of the following events is the most likely cause of the shift shown in the diagram?

A sustained increase in labor productivity due to state investment in training programs

A significant decrease in the nominal wage rate across major industries

A sharp increase in the global price of imported industrial raw materials

An expansion of the country's capital stock through net private investment

Aggregate demand and aggregate supply Questions

  1. A Level
  2. /Economics
  3. /Aggregate demand and aggregate supply