Refer to the information provided in Figure 26.3 below to answer the question(s) that follow. Figure 26.3 -Refer to Figure 26.3. Hurricane Katrina destroyed a large portion of the infrastructure along the Gulf of Mexico coast. This caused A) the short-run aggregate supply curve to shift from AS₁ to AS₂. B) the short-run aggregate supply curve to shift from AS₁ to AS₀. C) the economy to move from Point B to Point A along AS₁. D) the economy to move from Point C to Point B along AS₁.

Question

Quizplus · Accepted Answer

The destruction of infrastructure would decrease the short-run aggregate supply, shifting the curve leftward from AS₁ to AS₂.

Refer to the Information Provided in Figure 26