Why Does the Short-Run Aggregate Supply Curve Shift to the Right

question 42

Multiple Choice

Why does the short-run aggregate supply curve shift to the right in the long run,following a decrease in aggregate demand?

• A)Workers and firms adjust their expectations of wages and prices downward and they accept lower wages and prices.
• B)Workers and firms adjust their expectations of wages and prices downward and they push for higher wages and prices.
• C)Workers and firms adjust their expectations of wages and prices upward and they push for higher wages and prices.
• D)Workers and firms adjust their expectations of wages and prices upward and they accept lower wages and prices.

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Definitions:

Per Share Dividend

The amount of dividend that is paid out for each share of a company's stock.

Dividend Increase

A rise in the amount of money paid to shareholders out of a company's earnings per share.

Annual Dividend

A payment made by a corporation to its shareholders, usually as a distribution of profits on a yearly basis.

Dividends Increase

An action by a company to increase the amount of dividends paid to shareholders, typically signaling confidence in the company's profitability.