A change in the capital stock ________ the short-run aggregate supply curve and ________ the long-run aggregate supply curve.
A) shifts; shifts
B) shifts; does not shift
C) does not shift; shifts
D) does not shift; does not shift

Question

Quizplus · Accepted Answer

An increase in the capital stock increases the productive capacity of an economy, shifting both the short-run and long-run aggregate supply curves to the right.

A Change in the Capital Stock ________ the Short-Run Aggregate