Increase in Long-Run Aggregate Supply Curve | CFA® Level 1 Exam

Increase in Long-Run Aggregate Supply Curve

Prev Question Next Question

Question

An increase in the long-run aggregate supply curve indicates that

Answers

Explanations

Click on the arrows to vote for the correct answer

A. B. C. D.

D

Short run increases in aggregate supply do not shift the long run potential of the economy; only increases in the long run aggregate supply curve will effectively increase potential GDP. Short run aggregate supply may exceed the long run potential of the economy but only temporarily.