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3 December, 11:44

The long-run aggregate supply curve shifts right if a. immigration from abroad increases. b. the capital stock increases. c. technology advances. d. All of the above are correct.

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  1. 3 December, 15:12
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    The correct answer is option d.

    Explanation:

    The aggregate supply curve in the short run is upward sloping showing that aggregate supply will increase with an increase in price. Though in the long run the aggregate supply curve will be a vertical straight line. This is because in the long run supply depends on the state of technology and input level, not on the product price.

    When the immigration from abroad increases, it will cause an increase in the number of workers leading to an increase in aggregate supply.

    The increase in capital stock will also cause an increase in output and thus supply shifting the supply curve rightwards.

    Similarly, improvement in technology will cause the output to increase shifting the supply curve rightwards.

    So, all the options given are correct.
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