Asked by Jackson Hooper on Jul 17, 2024
Verified
Which is NOT a reason that an aggregate supply curve might slope upward to the right?
A) As production increases,people want to buy less.
B) As production increases,wages are bid up.
C) As production increases,interest rates rise.
D) As prices rise,producers expand output.
Aggregate Supply Curve
Represents the total supply of goods and services that firms in an economy are willing to sell at a given price level in a certain time period.
Upward Slope
In economics, it typically represents an increase or positive trend in a graph, such as rising prices or increasing production over time.
- Explore the properties of the aggregate supply curve and the scenarios under which it might change position.
Verified Answer
KO
Kyje' O'LoughlinJul 23, 2024
Final Answer :
A
Explanation :
An upward sloping aggregate supply curve occurs when there is a positive relationship between the price level and the quantity of output supplied. Option A suggests a negative relationship between production and demand, which is not a reason for an upward sloping aggregate supply curve. Options B and D suggest that as production increases, wages and profits rise, leading to increased output. Option C suggests that as output increases, the higher demand for goods leads to an increase in interest rates, which can then lead to higher production costs, ultimately resulting in an upward sloping aggregate supply curve.
Learning Objectives
- Explore the properties of the aggregate supply curve and the scenarios under which it might change position.
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