When the economy is producing at full capacity, the aggregate supply curve becomes
A) horizontal.
B) downward sloping.
C) vertical.
D) upward sloping.

Question

Quizplus · Accepted Answer

When the economy is producing at full capacity, the aggregate supply curve becomes vertical, indicating that no amount of increased demand can lead to an increase in output. This is because all resources are already fully utilized at this level of production.

When the Economy Is Producing at Full Capacity, the Aggregate