An increase in the level of technology shifts
A) both the SAS and LAS curves rightward.
B) both the SAS and LAS curves leftward.
C) the LAS curve rightward but leaves the SAS curve unchanged.
D) the SAS curve rightward but leaves the LAS unchanged.

Question

Quizplus · Accepted Answer

An increase in the level of technology improves productivity, which increases potential output, shifting both the Short-Run Aggregate Supply (SAS) and Long-Run Aggregate Supply (LAS) curves to the right.

An Increase in the Level of Technology Shifts