If the costs of production increase,there is
A)an increase in aggregate supply and the AS curve shifts rightward.
B)a decrease in aggregate supply and the AS curve shifts leftward.
C)an increase in the quantity of real GDP supplied and a movement up along the AS curve.
D)a decrease in the quantity of real GDP supplied and a movement down along the AS curve.
E)a decrease in aggregate supply and the AS curve shifts rightward.

Question

Quizplus · Accepted Answer

An increase in production costs reduces the profitability of producing goods and services, leading to a decrease in the quantity of output supplied at every price level. This shifts the AS curve to the left, reducing aggregate supply.

If the Costs of Production Increase,there Is