If the full-employment quantity of labor increases, then the
A) LAS curve shifts rightward and the SAS curve does not shift.
B) SAS curve shifts rightward and the LAS curve does not shift.
C) SAS curve shifts rightward and the LAS curve shifts rightward.
D) SAS curve shifts rightward and the LAS curve shifts leftward.

Question

Quizplus · Accepted Answer

The full-employment quantity of labor is the amount of labor that is employed when the economy is at full employment. If the full-employment quantity of labor increases, then the SAS curve will shift rightward because there will be more labor available to produce goods and services. The LAS curve will also shift rightward because there will be more demand for labor.

If the Full-Employment Quantity of Labor Increases, Then the