As the cost of resources increases, the aggregate demand curve shifts rightward and the aggregate supply curve shifts leftward.

Question

Quizplus · Accepted Answer

An increase in the cost of resources typically causes the aggregate supply curve to shift leftward due to higher production costs, but it does not cause the aggregate demand curve to shift rightward; instead, aggregate demand might decrease or remain unchanged because the increase in resource costs does not directly increase demand for goods and services.

As the Cost of Resources Increases, the Aggregate Demand Curve