Suppose an economy is initially in long-run equilibrium, and it then experiences a supply shock in the form of exceptionally high energy prices. Which of these will be true in this economy?
A) The short-run aggregate supply curve will shift leftward, and the long-run supply curve will shift rightward.
B) The short-run aggregate supply curve and the long-run aggregate supply curve will shift rightward.
C) The short-run aggregate supply curve will not shift, and the long-run aggregate supply curve will shift rightward.
D) The short-run aggregate supply curve will shift rightward, but the long-run aggregate supply curve will not shift.
E) The short-run aggregate supply curve and the long-run aggregate supply curve will shift leftward.

Question

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The Answer of Suppose an economy is initially in long-run equilibrium, and it then experiences a supply shock in the form of exceptionally high energy prices. Which of these will be true in this economy?
A) The short-run aggregate supply curve will shift leftward, and the long-run supply curve will shift rightward.
B) The short-run aggregate supply curve and the long-run aggregate supply curve will shift rightward.
C) The short-run aggregate supply curve will not shift, and the long-run aggregate supply curve will shift rightward.
D) The short-run aggregate supply curve will shift rightward, but the long-run aggregate supply curve will not shift.
E) The short-run aggregate supply curve and the long-run aggregate supply curve will shift leftward.

Suppose an Economy Is Initially in Long-Run Equilibrium, and It