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

question 110

Multiple Choice

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

• A)productivity falls.
• B)wages rise.
• C)sales taxes increase.
• D)input prices fall.

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Definitions:

Absorption Costing

A bookkeeping approach that incorporates all costs associated with production, including direct materials, direct labor, and both variable and fixed overhead expenses, into a product's cost.

Selling and Administrative Expenses

Operating expenses related to selling products or services and managing the business, excluding production costs.

Direct Materials

Parts and raw materials of a product.

Variable Overhead

Costs that fluctuate with production levels, such as utilities or materials used in the manufacturing process.