Question

In which situation would the long-run aggregate supply curve shift right?

A. if the money supply increases
B. if the price level decreases
C. if technology improves
D. if the price of oil increases

Answer 1

The long-run aggregate supply curve shifts right when technology improves and reduces the cost of production.

Step-by-step explanation:

In the context of the long-run aggregate supply curve, a rightward shift indicates an increase in potential output. This shift can occur due to various factors, including an improvement in technology. When technology improves, it reduces the cost of production, allowing firms to produce more goods and services at every price level. As a result, the long-run aggregate supply curve shifts right.