The short-run aggregate supply curve:
A) Becomes flatter at output levels above the full-employment output
B) Becomes steep at output levels above the full-employment output
C) Is upward-sloping with a constant slope
D) Is horizontal

Question

Quizplus · Accepted Answer

In the short run, the aggregate supply curve is upward-sloping but becomes steeper at output levels above the full-employment output due to diminishing returns to factors of production.

The Short-Run Aggregate Supply Curve