Which would most likely increase aggregate supply?
A) An increase in the prices of imported products
B) An increase in productivity
C) A decrease in business subsidies
D) A decrease in personal income taxes

Question

Quizplus · Accepted Answer

An increase in productivity would increase the amount of goods and services produced, thus increasing aggregate supply. A decrease in business subsidies (C) would likely decrease production and decrease aggregate supply. An increase in the prices of imported products (A) would likely increase the cost of production and decrease aggregate supply. A decrease in personal income taxes (D) would likely increase consumer demand, but it may not necessarily increase aggregate supply.

Which Would Most Likely Increase Aggregate Supply