An Increase in the Level of Prices of Goods and Services

question 83

Multiple Choice

An increase in the level of prices of goods and services will do what to the long-run aggregate supply curve?

• A)shift it to the right
• B)shift it to the left
• C)not shift the curve at all
• D)depends upon the long-run aggregate demand curve

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Definitions:

Marginal Cost

Marginal cost is the increase in total cost that arises from producing one additional unit of a good or service.

Standby Passenger

A traveler awaiting a seat on a flight or mode of transportation, typically without a reservation for a specific departure.

200-seat Plane

An aircraft designed to accommodate approximately 200 passengers, often used for commercial air travel.

Specialization

The practice of focusing on a narrow area of expertise to improve efficiency and productivity in production or performance.