(c) How would you shift the aggregative supply curve to represent each of the following changes in economic conditions?
I. The price of oil increases due to oil supplies being disrupted by hostilities in major oil country suppliers.
II. Due to less than expected wage demands, businesses find their production costs are lower than expected.
III. Electricity companies switch some generation capacity to more expensive renewable energy sources and the average price of electricity increases.
IV. The federal government moves to abolish a range of 'red type' business regulations which had been quite expensive for firms to comply with.
Shift AS to the left Shift AS to... View the full answer
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a) The AS supply will shift to the left, since the price for goods and services will increase. b) The AS will shift to the... View the full answer