A Decrease in the Price of a Nonlabor Input Such

question 46

Multiple Choice

A decrease in the price of a nonlabor input such as machinery

• A) shifts the SRAS curve to the right.
• B) shifts the SRAS curve to the left.
• C) causes an upward movement along the existing SRAS curve.
• D) causes a downward movement along the existing SRAS curve.
• E) none of the above

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Definitions:

Inputs

Resources such as labor, materials, and capital that are used in the production process to create goods or services.

Average Total Cost

The total cost divided by the quantity produced, calculating the per-unit cost of production.

Variable Cost

Charges that adjust in alignment with the volume of production or output levels.

Total Cost

The sum of fixed and variable costs incurred in the production of goods or services.