Which of the following would cause prices to fall and output to rise in the short run?
A) Short-run aggregate supply shifts right.
B) Short-run aggregate supply shifts left.
C) Aggregate demand shifts right.
D) Aggregate demand shifts left.

Question

Quizplus · Accepted Answer

When the short-run aggregate supply curve shifts right, it means that the economy can produce more output at any given price level. This leads to an increase in output and a decrease in prices in the short run.

Which of the Following Would Cause Prices to Fall and Output