The Short-Run Aggregate Supply Curve Is Most Likely to Shift

question 157

Multiple Choice

The short-run aggregate supply curve is most likely to shift down (to the right) when actual output is:

• A)equal to potential output.
• B)less than potential output.
• C)greater than potential output.
• D)not equal to potential output, regardless of whether it is above or below.

---

Definitions:

Efficient Outcomes

An economic condition whereby resources are allocated in the most effective manner, maximizing overall welfare.

Demand Curves

Graphic representations showing the relationship between the price of a good or service and the quantity of that good or service people are willing and able to buy.

Supply Curves

A graphical representation of the relationship between the price of a good or service and the quantity supplied for a given period.

Consumer Surplus

The difference between the maximum price a consumer is willing to pay for a good or service and the market price they actually pay.