With an increase in the capital stock, the short- run aggregate supply curve
A) shifts leftward.
B) remains as it is.
C) shifts rightward.
D) becomes steeper.

Question

Quizplus · Accepted Answer

An increase in the capital stock will lead to a rightward shift of the short-run aggregate supply curve as it will increase the economy's productive capacity, allowing for more output to be produced at every price level.

With an Increase in the Capital Stock, the Short- Run