-If the money wage rate and the price level both rise by the same proportion, then, in the figure above, the potential GDP line ________, and the aggregate supply curve ________.
A) shifts rightward; does not shift
B) shifts rightward; shifts leftward
C) shifts rightward; shifts rightward
D) does not shift; shifts rightward
E) does not shift; shifts leftward

Question

-If the money wage rate and the price level both rise by the same proportion, then, in the figure above, the potential GDP line ________, and the aggregate supply curve ________.
A) shifts rightward; does not shift 
B) shifts rightward; shifts leftward 
C) shifts rightward; shifts rightward 
D) does not shift; shifts rightward 
E) does not shift; shifts leftward

Quizplus · Accepted Answer

The Answer is E

-If the Money Wage Rate and the Price Level Both