If the price level falls, what will happen to the aggregate supply curve?
A)It will shift outward.
B)It will shift inward.
C)Nothing.
D)It will get steeper.
E)It will get flatter.

Question

Quizplus · Accepted Answer

The aggregate supply curve represents the total quantity of goods and services that producers are willing to supply at different price levels. A fall in the price level affects the aggregate demand curve rather than the aggregate supply curve, so the aggregate supply curve itself does not shift or change shape due to changes in the price level.

If the Price Level Falls, What Will Happen to the Aggregate