An increase in short-run aggregate supply is
A)the result of an increase in the price level.
B)represented by a movement up along the SRAS curve.
C)represented by a rightward shift in the SRAS curve.
D)both a and b
E)both a and C

Question

Quizplus · Accepted Answer

An increase in short-run aggregate supply is represented by a rightward shift in the SRAS curve. This means that at every price level, firms are able and willing to produce a greater quantity of output, indicating an increase in productive capacity or a decrease in input costs. An increase in the price level, on the other hand, would result in a decrease in short-run aggregate supply, represented by a movement up along the SRAS curve.

An Increase in Short-Run Aggregate Supply Is