The Long-Run Aggregate Supply Curve Will Shift to the Right

question 45

Multiple Choice

The long-run aggregate supply curve will shift to the right if

• A)the economy experiences technological change.
• B)there is a decrease in population.
• C)the economy experiences high levels of inflation.
• D)net exports decrease.

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Definitions:

Conversion Costs

Costs required to convert raw materials into finished products, typically including direct labor and manufacturing overhead.

Materials

The raw items or supplies used in the production of goods and services.

Equivalent Units

A concept in cost accounting used to allocate costs to partially completed goods, calculated by converting the work-in-progress into a number of completed units.

Unit Production Costs

The total expense incurred in manufacturing or producing one unit of product, including direct materials, labor, and overhead costs.