Which of the following shifts the short-run aggregate supply right?
A)an increase in the price level
B)an increase in the minimum wage
C)a decrease in the price of oil
D)a decrease in immigration from abroad

Question

Quizplus · Accepted Answer

If the price of oil decreases, then the cost of production for firms decreases, increasing their profitability and willingness to supply more goods and services at any given price level. Therefore, this will shift the short-run aggregate supply curve to the right.

Note: A and B would shift the short-run aggregate supply curve to the left, as they increase firms' costs of production and decrease their willingness to supply goods and services at any given price level. D is unrelated to short-run aggregate supply.

Which of the Following Shifts the Short-Run Aggregate Supply Right